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PTC Therapeutics, Inc.
11/7/2024
Welcome to the PTC Third Quarter 2024 Financial Results Conference Call. At this time, all participants are in a listen-only mode. After the speaker's presentation, there will be a -and-answer session. To ask a question during the session, you'll need to press star 1-1 on your telephone. You will then hear an automated message advising your hand is raised. To withdraw your question, please press star 1-1. Again, please be advised that today's conference is being recorded. I would now like to hand the conference over to your first speaker today, Jane Hanlon, Associate Director of Investor Relations. Please go ahead.
Good afternoon, and thank you for joining us today to discuss PTC Therapeutics Third Quarter 2024 Corporate Update and Financial Results. I am joined today by our Chief Executive Officer, Dr. Matthew Klein, our Chief Business Officer, Eric Powell, and our Chief Financial Officer, Pierre Gravier. Today's call will include forward-looking statements based on our current expectations. Please take a moment to review the slide posted on our Investor Relations website in conjunction with the call, which contains information about our forward-looking statements. Our actual results could materially differ from the forward-looking statements. As such statements are subjects to risks that can materially and adversely affect our business and the results of operations. For a detailed description of applicable risks and uncertainties, we encourage you to review the company's most recent quarterly report on Form 10Q, an annual report on Form 10K, filed with the Securities and Exchange Commission, as well as the company's other SEC filings. We will disclose certain non-GAP information during this call. Information regarding our use of GAP to non-GAP financial measures and a reconciliation of GAP to non-GAP are available in today's earnings relief. With that, let me pass the call over to our CEO, Matthew Klein. Matt?
Thank you all for joining the call today. I'm happy to share the results of another quarter of outstanding commercial performance and pipeline execution. In the third quarter, we achieved total revenue of $197 million, including $124 million from the DMD franchise. I want to highlight the $52 million in Amplaza revenue, which reflects our team's ability to effectively navigate a genericized and competitive marketplace in the U.S. With our strong third quarter revenue performance, we closed the quarter with over $1 billion in cash and are raising our 2024 total revenue guidance to $750 to $800 million. In the third quarter, we submitted two NDAs to the FDA, one for sepia-tarin and one for translana. Both applications have been accepted for filing. The FDA-planned action date for sepia-tarin is July 29, 2025. An action date has not been provided for the translana NDA due to the regulatory context of the filing. The sepia-tarin NDA includes the significant and clinically meaningful evidence of efficacy from the Phase III affinity study, as well as data from the Affinity Open Label Extension Study demonstrating durability of the sepia-tarin treatment benefit and the ability of patients to increase their protein intake while maintaining control of feed levels. These data support that sepia-tarin can provide significant benefit to PKU patients of all age groups and severity subtypes, including classical PKU. The impactful results from the Infinity Trial were recently published in the prestigious Lancet Journal, a testament to the importance of the study findings. In addition to the FDA submission, marketing authorization applications for sepia-tarin are currently under review in the EU and several other countries, including Brazil. We remain on schedule to submit the JNDA in Japan in December of this year. These submissions will support our planned global launch of sepia-tarin in 2025. Our launch plans are progressing well, as Eric will detail shortly. We remain on track to submit an NDA for vitiquinone for the treatment of children and adults with viticulatia in December. This NDA submission will be the fourth approval application submitted to the FDA this year, an impressive testament to our team's execution. The vitiquinone NDA will be based on the findings of significant benefit on the upright stability subscale of the M. for disease rating scale in the Move FAA placebo control trial, as well as results from two long-term extension studies. As we recently reported, both long-term extension studies met their primary end point with evidence of statistically significant long-term benefit in delaying disease progression. Given the extensive safety data collected to date in both children and adults, the vitiquinone has the potential to fill the unmet need for pediatric and adolescent FA patients, as well as provide a promising therapy for adult FA patients. Moving to our PTC-518 program for Huntington's disease, the program received fast-track designation from FDA in September, reflecting the potential of PTC-518 to be the first ever approved disease modifying therapy for HD. In addition, we requested two Type C meetings with FDA. One meeting is to discuss the potential for Huntington lowering to serve as a service endpoint supportive of accelerated approval, and the second meeting is to discuss the endpoint strategy for an FFC trial in HD patients, whether that trial is completed as a Phase III registration trial or as a confirmatory trial in the context of an accelerated approval. The FDA has asked to combine the two into a single Type C meeting, which has now been scheduled for later in the fourth quarter. The ongoing Phase II PIVOT HD trial continues to progress well, and we remain on track to complete the study in the first quarter of 2025, with results expected in the second quarter. Turning to our Utroloxostat program for ALS, we remain on schedule to share top-line results from the registration-directed Cardinals trial in the fourth quarter. Utroloxostat is the first compound being developed for ALS patients that specifically targets baroptosis, pathway of oxidative stress and cell death demonstrated to be highly relevant to ALS pathology. Given the recent changes in the therapeutic landscape for ALS, positive results from the Cardinal study could enable Utroloxostat to address the significant unmet needs of ALS patients. Finally, we remain on schedule for the November 13 FDA action date for the AADC Gene Therapy BLA. If approved, this would be the first ever -to-brain administered gene therapy authorized by FDA and open the door to a whole new approach to treating brain diseases. I am very proud of our team's ability to bring this pioneering therapy to patients. In summary, we have had a very busy and productive quarter as we continue to execute on all of our planned objectives and achieve our many significant 2024 milestones. I will now turn the call over to Eric to discuss our commercial performance. Eric?
Thanks, Matt. Our global customer-facing team had another strong performance in the third quarter, delivering 135 million of revenue across our five marketed products. Our global DMV franchise had a solid quarter with 124 million of revenue. Despite CHMP's recent negative opinion on renewal, there continues to be strong support from physicians, patients, and families throughout Europe for Translarnabase on the positive mortality of evidence in the trials and the real-world experience. We continue to ensure that Translarnabase is made available to boys and young men living with Nonsensic mutation and Duchenne muscular dystrophy in Europe, as long as it remains authorized pending review of the CHMP opinion by the European Commission. Outside of Europe, our commercial teams have worked effectively with healthcare professionals as we continue to add new patients and maintain those on existing Translarnar therapy in Latin America, the Commonwealth of Independent States, the Middle East, and North African countries. In fact, in the third quarter, we obtained first-time Translarnar orders from two new countries in the Middle East and North African region. In Brazil, we delivered the remaining 50% of a group purchase to the Ministry of Health. As Matt mentioned, the NDA for Translarnar is currently under review by FDA, and our highly experienced U.S. team is very well positioned to bring Translarnar to Nonsensic mutation DMV patients rapidly pending potential FDA approval. Now turning to Inflaza, third quarter net revenue was $52 million. We continue to work closely with healthcare professionals, payers, and specialty pharmacies to dispense the brand. Our PTC Cares team provides white glove personalized services and programs supporting each patient with copay assistance, brand information, and timely shipments from our specialty pharmacies, greatly enhancing the experience for both new and continuing patients. Our customer-facing teams are extremely excited about the potential upcoming global launch of SeptiaTheran for PKU patients. Based on the feedback from patients, families, and physicians, we believe SeptiaTheran has the potential to generate significant revenue, including an over $1 billion opportunity in the U.S. alone. PKU has a large addressable orphan disease population of more than 58,000 patients in markets with access and reimbursement, and the vast majority of patients are not receiving medical treatment due to the limitations of current options. We look forward to providing physicians with this important new differentiated treatment option to address these high unmet needs in PKU patients. As Matt mentioned, SeptiaTheran is under review in the U.S. and Europe, which are important steps in bringing this important new therapy to children and adults living with PKU. Further submissions are under review by regulators in Brazil, Canada, Switzerland, and Australia, with a filing planned in Japan by the end of this year, positioning PTC now for potential global launch in multiple major markets in 2025 and beyond. I will provide some details on our launch efforts, which have been ongoing for several years. We have been working closely with key PKU health care providers, including geneticists, pediatric metabolic specialists, and dietitians around the world to better understand the unmet needs and build a strong relationship with the PKU patient advocacy community. Our teams continue to develop a deeper understanding of the PKU landscape with many of the key treatment centers and prescribers. As you know, PKU is the most prevalent inborn era of metabolism disease, with reliable epidemiology via newborn screening available since the early 1960s. PKU patients receive their care from well-defined treatment centers and clinicians around the world. We have mapped these treatment centers and health care providers in key markets globally. Since the recent publication of affinity data, awareness of septuaterine has rapidly increased in many of these centers of excellence, highlighting the compound's differentiated efficacy profile seen in clinical trials as a convenient oral treatment, getting more patients to phenolalamine goal levels, and enabling potential diet liberalization. Our field-based teams have met frequently with PKU stakeholders, who have expressed their excitement about a new treatment option to address their unmet needs potentially available next year. Importantly, patients highlight optimism with the ability of septuaterine to liberalize diet, and this is an important motivator for patients to seek new treatment options earlier from their health care providers. Now in addition, we are leveraging our established rare disease global infrastructure, which has a footprint in over 50 countries. We will sequence the potential country launches of septuaterine to maximize access in key markets and maintain a narrow pricing and reimbursement corridor globally. Our research benchmarking of many rare disease analogs indicates a premium pricing strategy can be obtained based on the differentiated profile of septuaterine compared to current branded treatment options available, especially in key markets where PKU treatments are reimbursed and where we are planning our initial launch sequences upon potential approvals. Our customer-facing teams understand the complexities of managing rare disease treatments, as well as the regulatory and payer access landscape. These core capabilities developed at PTC over the last decade, along with septuaterine's highly differentiated profile, should facilitate rapid adoption for PKU stakeholders and reinforce our belief in a potential $1 billion plus opportunity, not only globally, but in the U.S. alone. Turning to Veticuinone, with the NDA submission plan for December of this year, our commercial team is excited for the potential opportunity to launch Veticuinone for FA patients in 2025. We believe that Veticuinone is well differentiated from current treatment options and could benefit all FA patients. In particular, pediatric and adolescent patients. KULs who treat FA believe there are significant unmet needs in this devastating disease. They tell us that Veticuinone's unique mechanism of action is compelling efficacy data in highly relevant functional parameters for FA patients, along with its favorable safety profile provide a strong rationale for treatment as early as possible in the course of the disease. Our experienced neurology team is focusing on key projects in preparation for the U.S. launch of the Veticuinone. Now moving to TXETI and Wey-Lever in Latin America, we continue to make good progress across these franchises, with growth in both newly identified and treated patients across the region. Our geographical expansion continues with a recent approval and positive HTA assessment of TXETI in Mexico, following which we have initiated reimbursement discussions. In Brazil, we delivered a new government purchase order for TXETI in the third quarter. In conclusion, we continue to execute on all fronts, based on a strong first nine months of revenue this year. As Matt mentioned, we are updating guidance with a 2024 total revenue guidance of $750 to $800 million. Our customer-facing team is thrilled by the opportunity to potentially launch four new products – AADC Gene Therapy, Translarna,
Septiotherin, and Veticuinone in the U.S., as well as Septiotherin globally in 2025. I will now turn the call over to Pierre for a financial update. Pierre?
Thank you, Eric. I will now share the financial highlights of our third quarter of 2024. Please refer to the earnings press release issued this afternoon for additional details. Beginning with top-line results. Total revenue for the third quarter was $197 million, including DMD franchise revenue of $124 million. Translarna net product revenue in the quarter was $72 million, while Inflaza net product revenue of $52 million. Moving to everyday. Third quarter global net revenue of approximately $460 million was achieved by Roche, resulting in royalty revenue of $61 million for PTC. Non-GAAP R&D expense was $152 million for the third quarter of 2024, excluding $9 million in non-cash stock-based composition expense, compared to $150 million for the third quarter of 2023, excluding $14 million in non-cash stock-based composition expense. Non-GAAP S&D expense was $63 million for the third quarter of 2024, excluding $10 million in non-cash stock-based composition expense, compared to $68 million for the third quarter of 2023, excluding $13 million in non-cash stock-based composition expense. Cash, cash equivalence and marketable securities totaled $1.0 billion as of September 30, 2024, compared to $877 million as of December 31, 2023. Our strong financial position provides PTC with the necessary resources to execute on our strategy and achieve our milestones over the next several years, including the anticipated launch of Sepia Perin and other products. I will now turn the call over to the operator for Q&A. Operator?
Thank you. At this time, we will conduct the question and answer session. As a reminder, to ask a question, you will need to press star 1-1 on your telephone and wait for your name to be announced. To withdraw your question, please press star 1-1 again. Please stand by while we compile the Q&A roster. Our first question comes from Christine Klosek of Cantor Fitzgerald. Your line is now open.
Hi, this is Rick on for Christine. Thanks for taking our question. We got two for you. So first of all, thanks for the update on the Type C meeting in Huntington. Do you have a sense for when you could update the community on any clarity that might come out of the meeting? Is there any chance that we'll learn more about a potential path forward here?
Thanks for the question. We know there's a lot of excitement around the discussions we're going to have with FDA both in terms of understanding the endpoints for an efficacy trial, but also, of course, the discussions around Huntington lowering as a surrogate endpoint. As we've talked about, when we think about surrogate endpoints and accelerated approval, what the FDA really wants is for us to be able to present a package of scientific evidence of why lowering Huntington protein is likely to provide clinical benefit ultimately, and are there specific thresholds of lowering that have been associated with that benefit? So we have been able to provide them with the rich scientific literature, including in vitro and vivo and human studies, which show that if you lower Huntington protein 20 to 50%, that you're likely to have a significant benefit in slowing disease progression. And of course, as we've shown in our 12-month HIV update, we are achieving that threshold of lowering Huntington protein. We expect to have these meetings with FDA in December of this year, and as always, as soon as we have clarity, which sometimes comes at the time of the meeting or shortly thereafter or once we receive minutes, we'll be sure to share that with the broader community, including the street, as we know there's a lot of interest in hearing about this path forward for accelerated approval of pivot HD.
Excellent. And maybe just one more if we have time. We've seen a lot of regulatory flexibility in the rare disease space recently. So, you know, given the FDA resubmission and for TransLorna, can you talk about how you think the FDA might sort of weigh the stride registry data and study O41 that were submitted and just kind of looking at these new evidence, given sort of how things have been going in terms of regulatory flexibility? Thanks.
Sure, Rick. So, as we talked about before, the FDA resubmission for TransLorna was based on two things. First, the evidence of significant
benefit
in the overall enrolled population of 359 boys in study 41. This is where we had significant effect on six-minute walk distance, north-south ambulatory assessment, time function test, time to loss of 10%. That data set in a broad, nonsense DMV population showing significant benefit across all those endpoints is actually pretty unique with flexibility or not. I think this is really a first data set that has in an ITT population significant effect across all these endpoints. In addition, as confirmatory evidence, which the agency likes to see in addition to a single adequate and well-controlled trial, we have the stride registry. And what the stride registry is able to demonstrate is these significant benefits we're seeing on ambulatory function and other aspects of disease in the short term of study 41 are manifesting cumulatively over several years as a delay in loss of ambulation of three and a half years. So, of course, any flexibility the agency can bring to the assessment of the package would be great, but on its own, we have an efficacy package with evidence of clinical benefit in both the short term and the long term in nonsense DMV patients, which is quite a unique and compelling package of data.
Thank
you. Thank you. Our next question comes from Eric Joseph of JPMorgan. Your line is now open.
Oh, good evening. Thanks for taking the questions. I have one on the Cardinals trial. We noticed recently that you updated the or changed, modified the primary endpoint to use a participant ranked combined assessment of ALS, FRS, and also survival. Can you talk about what some of the motivations were behind changing to that endpoint and what their, what that impact might be from a statistical powering perspective? And I guess I think you've also now over enrolled the study. Was that meant to accommodate the change in endpoint or would you in fact now be sort of slightly overpowered versus prior expectation? Thank you.
Thanks for the questions, Eric. So, those two are not related. Your two questions are not related. The first is really a way of analyzing the results of the study. The outcome of interest remains the ALS, FRS score, which is a continuous variable that rates disease progression over the course of the trial. However, it's well known that patients will die over the course of the study and the FDA has recommended in order for us to account for death in the primary analysis, they would like us to use their preferred analysis method in ALS, which is known as the Joint Rank Test, which is the statistical test that's able to incorporate the information of decline on the ALS, FRS as well as any deaths that occur during the course of the study. So, it's really just a change in the way we're analyzing it to include deaths in the primary statistical analysis of the data. And again, this came from feedback from the FDA on the analysis plan as they have said that that is really their preferred analysis method. And certainly if you look back to their reviews of other ALS drugs, you'll see that that is in fact the test that they like to use because it's able to incorporate information from all subjects. Regarding your second question, as we've talked about, we had a target population for the primary analysis population based on a rate of progression observed during the two-month run-in of the study. So, in this two-month run-in study where we observe patients and calculate how many points they change on the ALS, FRS scale, we need to enroll a certain number of patients in order to achieve the targeted number of patients in that primary analysis group. So, what you see in the increase in enrollment was really just because we had a slightly lower yield of screen subjects who actually met the criteria for the primary analysis population.
Okay, got it. Thanks very much for taking the questions.
Thank you. One moment for our next question. Our next question comes from Kelly Shi of Jeffries. Your line is now open.
Thank you for taking my questions. Given the revenue bid for this quarter, could you help us to set up an expectation for Q4 maybe also into 2025? What would be the dynamic DMD franchise also versus relatives from Abu Dhabi? Thank you.
Yeah, thank you for the question, Kelly. So, as we said, the revenue was quite strong this quarter, which allowed us to raise the overall guidance this year to $750 million to $800 million. We expect in the fourth quarter continued contributions from across our portfolio of in-line products in terms of both the DMD franchise revenues we talked about in Flauza continues to perform incredibly well. Teams have done a great job protecting the brand in the face of generic competition. And TransLarna revenue we expect to be stable over the fourth quarter. Certainly as it remains available in Europe, we will have the typical lumpiness that we see quarter to quarter with TransLarna, but overall we expect strong DMD revenue contribution in the fourth quarter.
Thank you. Thank you. One moment for your next question. Our next question comes from Jeffrey Hung of Morgan Stanley. Your line is now open.
Hi, this is Michael Riat, answer Jeff Hung. Thank you for taking our question and congrats on all the progress in all the programs. Ahead of the Cardinals top line in 4Q, do you plan to share baseline characteristics maybe like time since diagnosis or can you comment on maybe what percent of patients are going into the OLE?
Yeah, Michael, thanks for the question. So typically with our top line results, we'll give the key baseline characteristics and results with regards to the key endpoints. We've seen excellent continuation of patients as they roll into the OLE once they finish the Cardinals.
Okay, thank you. And then maybe for the long-term FA extension studies of the tympanone, why do you think you start to see the meaningful separation more in the extension studies? Was like a rapid impact on MFAR as expected or could you perhaps like add some more color on how like the tympanone is influencing the trajectory there?
I think what we're seeing is a continued benefit in terms of preservation of function. As we reported when we read out the 72-week placebo controlled study, we saw an approximate 50% slowing in progression in the treatment group relative to the placebo group. And at three years, we're still seeing that 50% benefit, 50% slowing the progression. As we reported in the patients who started on ventiquenone, they had a 3.7 point decline, whereas in the natural history cohort, there was a 7.5 point decline. So we're seeing a continuous benefit in terms of preserving function and slowing disease progression. Thank you so much.
Thank you. One moment for our next question. Our next question comes from Ryan Abrams of RBC Capital Markets. Your line is now open.
Hey, good evening. Thanks for taking my questions. I guess one on cephalopterin and one on translarna. Just for cephalopterin, I'm curious if you could maybe talk a little bit more about the actions from providers, patients, and payers to the Lancet data, and in particular maybe elaborating on some of the payer research and communication that's given you confidence in the potential for the premium pricing. And then on translarna, just wondering if you had any sense of the potential timelines for the next review steps there, both in the U.S. and Europe, and whether you think we might hear some updates in 2025. Thanks.
Sure, Brian. Thanks for the questions. Let me tackle translarna first, and then I'll pass the second question on cephalopterin over to Eric. So first on translarna, so you asked about the U.S. and the EU. In the EU, we're, of course, in that period now of approximately 67 days following the CHMP opinion, where the European Commission does its assessment of whether or not they want to adopt the opinion. So we don't expect to hear anything further for at least approximately 67 days, and as we've talked about, translarna remains authorized in this period, and of course we're making sure that we continue to provide the drug to patients and make it commercially available while authorization remains. In the U.S., as we've talked about, given the fact that this was a resubmission of an NDA that had initially been filed over protesting 2016 many, many years ago, nonetheless, the FDA is not bound by a clock in terms of doing this review. However, we expect just given what's involved in the evaluation of a resubmission, which is just a portion of really the efficacy package, we would expect that they'll get to the review in the next few months. So as soon as we have more information on the specific timeline and can provide any clarity, we will. Regarding CPTAN, let me just make the first comment that obviously we were quite excited about the Lancet publication. I think that's a true testament to how differentiated CPTAN is with its dual mechanism of action, not only in its ability to act as a precursor to the BH4 cofactor, but the fact that it has a second chaperone mechanism of action, which allows it then to provide benefit to patients who are not BH4 responsive, which again is a really important element of why we're seeing such significant effect across the board in PKU patients of all severities and variety and genotypes. The physicians are very excited about this. I think they see the Lancet publication as being consistent with what they believe, which is that this is a potentially transformative therapy that can meet the significant need for PKU patients. Let me turn it over to Eric to talk a little bit more about our payer discussions and how we're thinking about potential pricing.
Yeah, thanks, Matt, and thanks, Brian, for the question. As you can see, we're really pleased with the publication of Affinity. We've been able to engage in a lot of payer activity, including market research, but also doing a lot of landscape research in many of the countries where we're sequencing it. Clearly, what payers have told us is that they see a differentiation based on its efficacy profile and seeing that more than eight out of 10 patients can actually achieve therapeutic goals and importantly, that fee levels and those goals can be measured rapidly. With a very high and met need, we know that there's close to 90% of the population that is not on medical therapy at this time. There is a high and met need and payers see that and they're willing to pay a premium price both in Europe as well as in the US because they know that they can achieve or they can actually see the levels of therapeutic gain literally in a matter of weeks with septuiterine. Obviously, our pricing strategy is evolving, but as we know, we've actually looked at a number of different analogs, including many that have been recently launched that are clearly differentiated. We believe that having a premium price over existing branded therapies can be achieved in many of these markets. Finally, I'll just say that pricing strategy really is not going to be announced until we get much closer to launch and then when we have the final label.
That's really helpful. Thanks, Eric. Thanks, Matt.
Thank you. Our next question comes from Ellie Merle of UBS. Your line is now open.
Hey guys, thanks for taking the question. Can you talk a little bit more about the potential path forward and potential range of outcomes in terms of the feedback that you could specifically get from this type C meeting? And if the FDA is not supportive of the use of Huntington-Loring as a surrogate, I guess what would the potential range of outcomes from there be in terms of what the clinical endpoint study and path forward for registration could look like? And I guess in that scenario where the FDA is not supportive of the use of a surrogate, how are you thinking about your strategy around whether you would run a full phase three on your own or look for a potential partner?
Thanks for the question, Ellie. Obviously, we're optimistic about the ability to have a productive discussion with the agency regarding the potential for Huntington-Loring to serve as a surrogate endpoint because it really meets what they ask for in terms of a surrogate endpoint. That is, there's evidence that shows that reductions in Huntington protein can have clinical benefit. There's a specific threshold associated with that which we're able to achieve. And just taking consideration of the disease itself, that it's a monogeneity of disease that's caused by a toxic mutant Huntington protein and we're able to address that, I think it's very squarely in the way they have thought about surrogate endpoints and other disorders where there's an implicated protein and a drug-targeted protein, for example, that's not just for fitting DMD. We also believe that the agency has had an interest in leveraging the accelerated approval pathway for neurodegenerative disorders like Huntington disease where there's significant medical need and establishing efficacy takes a bit of time. So if there's a safe therapy that has shown that the ability to impact a marker of disease that is known to be important to that disease pathology, that certainly could open the door for an accelerated approval. And again, we believe that PTC518 and lowering Huntington protein certainly fits. At the same time, we're also having a discussion about endpoint strategy for an efficacy trial because what we want to do is be in a position to move forward with that efficacy trial as quickly as possible, regardless of the outcome of that meeting. For example, we could meet with FDA and they could say these initial data from the first 30 or so patients from pivot HD look very good. Why don't you come back with the complete data set from pivot HD and we'll revisit the surrogate endpoint discussion in the spring. That's a possible outcome. And if that occurs, we still want to be ready to put in place and get started on the efficacy trial because we're going to need that efficacy trial to be initiated either as part of an accelerated approval or as you say, in the situation where the door is shut on a surrogate endpoint, we want that study up and running so we can get to the finish line as quickly as possible. In terms of conducting the study, look, we've said all along that we have positioned a company and built that balance sheet to be able to conduct that phase three study. We have the infrastructure and capital to do that. Obviously our team has worked incredibly closely with the Huntington's disease community, including the patient groups and the physicians around the world, who are incredibly enthusiastic in participating in the study, whether that's as an investigator or the patients who want to be in that study either because they didn't have the opportunity for the previous study where they've seen the data now and really want to be a part of a Huntington-Boward trial of an oral therapy which is easily administered and has shown to be safe and well tolerated. So we look forward to being able to advance that trial. Again, we'll do it either way, whether it becomes the registration trial or the confirmatory study in the context of an accelerated approval.
Great. Thanks. Just a quick follow-up. I think you mentioned that you had requested two types of meetings with the FDA, but the FDA asked to combine the two into a single meeting. Maybe this is just logistical, but can you share maybe any context around this or maybe what this might suggest? Yeah, thanks.
Yeah, again, this is purely logistical. We submitted the meeting request roughly the same time, and as you know, it's going to be the same people who review and discuss and provide their feedback. And as proud as we are of how well we've been collaborating with the agency in the neurodivision, I think they, for logistical reasons, would rather just have one meeting rather than two where the issues have such overlap and it's the same people involved. So we look forward to having that one meeting in December.
Got
it.
Thank you. Our next question comes from Joel Beattie of Baird. Your line is now open.
For TransLearn, what percent of the current XUS sales would not be affected by any potential European Commission decision, and also how long could those sales potentially last into the future?
Yep, Joel, thanks for the question. As we've talked about, in 2023, roughly 46% of TransLearn of revenue was from Europe itself. That would be the revenue that we think that would be at risk in the event that the EC adopts the CHMP opinion. Now, we've said going forward that there's a possibility in certain countries that we can leverage inpatient or other individual country pathways to still make commercial product available, but obviously that will be something that will play out on the other side of an EC adoption. But again, it's that European revenue that we would see at risk and only that revenue.
How long would exclusivity be in those other regions?
It varies. We have in many regions exclusivity out to 2029.
One last question. For Friedrich's cataxia in the US, do you expect an ad com?
Hard to know. Obviously, we'll submit the package. We expect to submit it in December. We would expect there to be a prior review. We'll find out at that point whether or not there'd be an ad com. Now, certainly the FDA is quite familiar with Friedrich's cataxia having already approved a therapy for that disease. There's obviously a number of therapies in development, so they should have a great deal of understanding of the endpoints. Particularly, we know they have a very good understanding of the importance of the upright stability subscale with our discussion. I know that they would need to have an ad com from the standpoint of this being novel in terms of first in disease therapy or first time they've looked at this end point. But if there is an ad com, we'll be ready for it.
Thank you.
Our next question comes from Sammy Corwin of William Blair. Your line is now open.
Hey there. Congrats on the quarter and thanks for taking my question. As you look ahead for the launch of Cepheid-Tarrant, are you envisioning specific patients to be early adopters and what are your assumptions in terms of the percentage of patients that may go on the drug who would be classical? And based on your conversations with payers, have they kind of disclosed that many of their covered patients would have to step through generic Coup van? And then I have a follow up.
Yeah, sure. Let me start and I'll turn it over to Eric. So as we talked about, we see several segments of the population that would be early adopters, including those that are Coup van non-responders, which would be classical PKU patients or those not tried on Coup van, as well as those who've been on BH4 and not had optimal response. So those are two segments that we believe that we can easily access just based on the strength of data from the affinity study. And as we've heard from KOLs in our commercial detail last summer, they're saying they want to try all their patients on Cepheid-Tarrant regardless of whether they fit into those buckets. But let me pass over to Alex and talk a bit more about how pay dynamics can play into that.
Yeah, Sammy, thanks for the question. It surely is an unmet need market. Right now, what we've seen is 90% of the patients don't get medical treatment. They've either tried, failed or discontinued for a variety of reasons. And the current standards of care are inadequate, and physicians see that, but also payers see that. So it's not a very difficult conversation when we've discussed this with payers around the world in these key markets, also with U.S. payers, that one, there is a substantial number of patients that can benefit from treatment, from a highly efficacious and oral treatment that can be easily taken. Second, as I mentioned earlier, we can have a premium pricing strategy simply because they recognize that these patients do not have adequate treatment. They're not controlled with diet. They're not controlled with current treatment. And they can actually measure what efficacy is very quickly and rapidly. So this isn't something that is a burden in terms of the cost. They can see fee level reductions very rapidly. They can measure diet liberalization. They can also measure how many patients actually get to therapeutic goals. So everything that we've presented has been supported by the affinity data and the -to-head study so far has been well received by the payer community. And when we've talked about premium pricing strategy, we definitely know that physicians and patients already know the access pathway there, will be able to get access to treatment quickly and rapidly. To your question about step edits, I think it's a very simple and easy thing because again, fee levels can be measured very quickly. So step edits can, we can get patients quickly on to subcuterone through prior authorizations and rapidly through fee measurements.
So
overall right now, the response has been overwhelming by the affinity data and the PKU community right now is very excited to have a new treatment option.
Great, thank you. And I think the team has pointed out the $1 billion opportunity in PKU before and that was with the assumption of modest penetration. So I guess what are your internal assumptions for penetration to reach that $1 billion opportunity in the US?
Yeah,
I think right now, I would say first of all, we're preparing for a global launch. So there's going to be contribution everywhere but we believe that there's a billion dollar opportunity in the US alone. And if you look again, if you have somewhere between 17,000 to 20,000 patients and 90% of them are not on medical treatment, a very modest penetration, even somewhere between 20 to 30% would get you there. And especially if it's supported by a premium pricing strategy, which we believe we can get, you know, and while we believe a billion dollar launch in the US alone is an important opportunity, we're not ready to guide yet on the product. We're going to be, as we get closer and closer to launch, we will be guiding on product revenue. We're excited with this opportunity because of the substantial unmet need and how many patients currently are not on medical treatments.
Got it. Thank you.
Thank you. Our next question comes from Peyton Bonsek of TD Cohen. Your line is now open.
Hi, this is Peyton on Pajow and congrats on the end of the strong quarter and thanks for taking your questions. I guess on the particular known application for December, what's outstanding for the submission and then I know the FDA requested some stats and natural history when you were designing the analysis. Have you sent that to the FDA? Have they reviewed it and given any feedback? And then I've got to follow up.
Yep. Thanks for the questions, Peyton. I'm not sure I've heard the second part of your question about the statistical analysis plan. Is that what you asked?
Oh, I was asking whether or not after the readout came in October, the FDA has reviewed that or have you sent that to the FDA and if they've given any feedback on it?
Oh, got it.
Okay.
So in terms of
outstanding items, we're just finishing up all of the summary reports and write-ups from the long-term extension studies. Obviously, we got those results in October. It takes some time to just write that all up, format it, get the tables set and send it in. We had had our pre-NDA interaction with the agency also in October where we reviewed with them the contents of the package, including what we were planning to show in terms of long-range, long-term outcome data. They've seen some of the data and importantly, they had previously agreed to the statistical analysis plans we were using both for the analysis of the MOVE FA long-term extension as well as the long-term extension data from the earlier placebo-controlled study completed a few years ago. So they knew exactly how we were going to analyze the data, how we went about doing the matching, the endpoint strategy with the primary endpoint being change in MFAR scale over time. And so we were fully aligned with them on that and as I mentioned, they have seen some of the data. We don't expect any additional feedback from the agency until after we submit the NDA.
Great. That makes a lot of sense. And then I guess really quickly, to the DINCHEPS data, have all the necessary inspections been done from the manufacturing facility and then assuming approval next week, how quickly could you launch the therapy and how does patient identification come?
Yeah. So with the FDUFA date of November 13, any inspections are long since done. Everything went quite well from an inspection standpoint and we look forward to hearing from the agency next week. We obviously remain optimistic about the potential for approval based on our interactions and we look forward to being able to bring this transformative therapy to patients in the U.S. as quickly as possible. Great. Thank you.
Thank you. Our next question comes from Paul Choi of Goldman Sachs. Your line is now open.
Hi. Good afternoon and congratulations on the quarter. Thank you for taking our questions. I want to maybe just follow up on, with regard to the particular pair discussions here. Can you maybe just comment on what pair feedback has been and just sort of how you maybe potentially sort of thinking about pricing relative sky clarus here for the adult population? And secondly, the cash position remains very healthy here and Matt, I just wanted to sort of ask what your appetite is currently for potential external business development versus funding the upcoming multiple launches here in 25. Thank you very much.
Thanks for the questions, Paul. Obviously we're a bit early to be having the pair discussions on the tickling. We're focused now on getting the package in. But I would say that, look, there's a clear unmet need for pediatric and adolescent patients and we have a data package in terms of safety and efficacy that supports an important benefit for these patients. As we know as well, there's an important proportion of patients who are pediatric and adolescent, but as diagnosis is increasing in the field, patients who are being diagnosed are increasingly young. And so that need, that unmet need for FA patients is getting strong and we look forward to being able to provide a safe and effective therapy for those patients. But as you raise, we also believe we can provide a therapy for adult patients. We have evidence in MOVE FA of benefit in adult patients. We have evidence on the upright stability scale, which speaks directly to the ability to reduce risk of loss of ambulation, which is incredibly important for any ambulatory predracoetaxia patient of any age. And of course, in the long-term extension studies of both MOVE FA as well as the earlier placebo control study, which was conducted only in adults, we have evidence of important long-term benefit in slowing disease progression. Again, we also have a very strong safety and tolerability profile. So I believe we have really a differentiated product that we look forward to thinking about how the price and also having discussions with the payers on that. In terms of the cash position, look, we've worked very hard, both in terms of restructuring the balance sheet towards the end of last year, our efforts to reduce operating expenses and move the company towards cash flow breakeven. I think having this strong cash balance not only enabled us to launch the products, and we would love to be in that situation of needing to have the capital to launch more products within a year in the US and the global launch of Sepia Taren, but we also, of course, remain opportunistic about business development. And we have the cash we have at hand. We also have the ability, if we needed to, to draw down some of the additional royalty monetization that we did with Royalty Pharma if we saw an opportunity that fits well into our portfolio. Look, we're in a position where we could be launching many products in the US in the short term, and so now we need to think about how we could use business development in a strategic way to help fill out the commercial portfolio XUS and also think about any other opportunities that can set very easily into our existing commercial infrastructure or even development infrastructure.
Great. Thank you. Thank you.
Our next question comes from Gina Wang of Barclays. Your line is now open.
Thank you. I have a few quick questions. The first one regarding Sepia Taren, Padoopaday, July 29, 2025. Just want to confirm that FDA confirmed there will be no Padoopaday, no Atacom. The second question is regarding the translana. You mentioned that, you know, right now, the 67 days in EU. So can you walk us through, like, say, after 67 days, if the decision is unfavorable, what will be the next steps and how long would that take the process in the end when we really will see the actual impact on the revenue in Europe? And related questions, or maybe unrelated, Brazil, I know you are under independent assessment there. They have independent approval process back in April. So there's an update there regarding the renew process there. Lastly, very quickly, regarding ADC next week, you will get approval. Hopefully, keep our fingers crossed. How ready are you regarding the manufacturing? How many doses you already stocked? And how quick do you think you can get ready to, how many patients you already identify in the US?
Gina, thank you for the questions. I'll go through them one by one. First, on the PEDUFA date for CDTARIN, it is July 29, 2025. We do not expect it to be an ADCOM. There's been no indication of ADCOM. And again, we're in a situation where the endpoint of the trial, reduction of phenylalanine, is published as being one of the blood tests that can support full approval. Obviously, the agency understands PKU. They've approved two therapies, four for PKU. So I think this is not one where we would expect to have an ADCOM. In addition, the clear efficacy in the data package also leaves very little question that I think that would need to be brought to an ADCOM. Your second question was about TransLARN and the timeline in the EU. Look, the 67 days is an approximately 67 days, as we learned the first time we went through this in the spring. We expected 67 days to take us from late January to late March, early April, and it wasn't until late May that we actually got confirmation that the EC had made the decision to not adopt the opinion and send things back to the CHMP. So I think it's the approximate 67 days. And Gina, we can't say for sure what happens on the other side of that. This is going to depend on what the European Commission says. They could adopt the opinion and say, we're going to adopt it for immediate implementation, or we're going to adopt it with delay implementation. We're in a situation here, and it's important to realize that this is not being, this has not come about due to a safety issue. So there's no patient risks here in terms of there being an urgency to get the product off the market. So I think that may also provide a little bit of flexibility as well in terms of what exactly happens in terms of the steps following an adoption of the negative opinion. And then, of course, it's sent back to the CHMP, and that's a whole lot to see what those instructions are as well. So still a lot of unknown there. The 67 days is approximate, and obviously we'll learn more as we reach that timeline. In terms of Brazil, it is an independent assessment. It has been ongoing. We have not gotten any additional feedback from ANVISA. What we do know is that we had two orders in Brazil, both orders, one in the second quarter, one in the third quarter. We obviously view that as a good sign that there's obviously a strong interest in the Ministry of Health to ensure that patients in Brazil remain on trends more enough. And then in terms of ADC, we're ready. I mean, again, we had the EU approval in 2022. We've had approvals. We had decent approval in Brazil for ADC deficiency, approval in Taiwan, approval in the UK. We're doing cross-border care. We're in the process of treating patients around the globe. We have more than adequate supply. And again, once we see the label, we'll understand what the addressable patient market could look like in the US. And we believe we have more than enough supply at hand to treat patients well through the next one to two years.
Great. Thank you.
Thank you. Our next question comes from Danielle Brill of Raymond James. Your line is now open.
Thank you so much for the question. I just have a quick clarification from an earlier question. I'm curious why the TransLARNA NDA Commission is technically a resubmission under protest. Why wouldn't it be a new NDA since you now have new data to review from study 04-1? Thanks
so much. Danielle, this goes back to 2016-2017. In 2016, the NDA was filed over a protest. The agency reviewed it and issued a complete response letter. The main issue in the complete response letter was the need to conduct an additional adequate and well-controlled trial to establish efficacy. Study 04-1 addresses what was in that CRL, and therefore this was technically a resubmission of that NDA, now fulfilling the deficiency identified that led to the complete response previously in 2016. Does that make sense?
It does. Thanks, Matt. I appreciate the clarification.
Of course.
Thank you. Our next question comes from Joe Schwartz of LeeRink Partners. Your line is now open.
Hi. Thanks so much. I have a question about the ticlonone and one on uterolactosate. So in FA, we've heard that while some patients think that they've benefited, more patients seem to not be blown away by cyclaruses efficacy. So we're wondering how that might influence how patients might feel about the ticlonone, which is following in its footsteps and works further downstream. How do you think this market is evolving now in terms of patient demand and retention for new treatment options, as well as their potential to switch or try a combo with the ticlonone?
Yes. Thanks for the question, Joe. First, the ticlonone acts upstream of, at least mechanistically, of where cyclaruses are in terms of its effects in the theroptosis pathway. But I would say, look, I think in the, clearly there's no option for pediatric and adolescent patients with cyclaruses given the age limitations of the label. And in terms of the adults, I think it's always hard with drugs at slow disease progressions and patients' perceptions of if they're getting better or not. It's always hard to know. But needless to say, I think that we would certainly be able to provide a therapeutic option where we believe we can provide benefit to patients. The data from MOVE-FA show an effect not only in slowing of disease progression, but also a significant effect on the fatigue scale, which we know is the number one symptomatic complaint of patients with phrygic ataxia. Do I think that people will be interested in combo therapies? I do. I think there's a lot to be sorted out there, of course, in terms of payers and such. But I think, look, when any time you have a complex disorder like phrygic ataxia, it would make sense that you would likely need more than one therapy. And it might be that two therapies could have a combined effect. But look, we look forward to being able to offer particularly to FA patients, particularly the kids and adolescents who desperately need a therapy. I mean, look, if you're going to slow disease progression, the best thing to do is to start as early as possible so that you can enjoy the benefits of slow progression as much as possible. And for adults, we welcome the opportunity to divide them with a safe and effective therapy as
well. OK, thank you. And then for targeting theroptosis in ALS, can you give us some context for what you're trying to achieve mechanistically? Is there a particular threshold you're looking to meet based on any preclinical or natural history data that supports your therapeutic hypothesis? And have you done anything in the Cardinal study to select patients that might best respond?
Yeah, it's a really, really good question, Joe. Obviously, this is the first in disease study we have with each of us, and I expect we'll learn a lot on the other side about how we can, how enrichment could possibly go. The rationale for targeting theroptosis is very well established in ALS. There's a number of different preclinical studies that clearly show that if you target theroptosis, whether that's by inducing overexpression of GPX4, which is a key enzyme in the theroptosis pathway, you have significant phenotypic benefit. Similarly, if you augment the theroptotic process through any number of insults, you can accelerate decline in ALS. The whole concept of SOD1 in superoxide dissonance speaks directly to being able to affect oxidative stress and the relevance of oxidative stress in ALS. So there's a great bit of data to support the rationale for targeting theroptosis, but look, ALS is an incredibly complex and aggressive disease. We hope to be able to provide a therapy that can slow that progression by targeting what's known to be a key pathologic element. Thank you.
Thank
you. This concludes the question and answer session. I would now like to turn it back to Dr. Matthew Klein, CEO, for concluding remarks.
Thank you very much, Operator. Let me just follow on the last question to Joe and just share with everyone that as we are getting close to having data for the future loxostat Cardinals ALS study, following this call, we're going to not be taking any questions and be in sort of a quiet period for the Cardinal study just because of where we are in terms of being close to having data in the next period of time. Overall, again, thank you everyone for joining the call. We're incredibly excited about the strength of the core, the revenue performance, the ability of our teams to continue to execute at an incredibly high level across all parts of the company, whether it be on the commercial side, on the clinical and the regulatory side, and all around. We look forward to keeping you updated as we saw the number of important milestones this year. And again, thank you all for joining the call and have a good evening.
Thank you for your participation in today's conference. This does conclude the program. You may now disconnect.