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spk10: Greetings, and welcome to Rigel Pharmaceuticals' financial conference call for the second quarter 2021. At this time, all participants are in a listen-only mode. A brief question and answer session will follow the formal presentation. When required, please press star zero on your telephone keypad. As a reminder, this conference is being recorded. It is now my pleasure to introduce our first speaker, Dolly Vance, who is Rigel's Executive Vice President, Corporate Affairs and General Counsel. Thank you, Ms. Vance. You may begin.
spk01: Welcome to our second quarter 2021 financial results and business update conference call. The financial press release for the second quarter was issued a short while ago and can be viewed along with the accompanying slides for this presentation In the News and Events section of our Investor Relations page on our website, www.rigel.com. As a reminder, during today's call, we may make forward-looking statements regarding our financial outlook and our plans and timing for regulatory and product development. These statements are subject to risks and uncertainties that may cause actual results to differ from those forecasted. A description of these risks can be found in our most recent annual report on Form 10-K for the year ended December 31, 2020, and subsequent filings with the SEC, including our Q2 quarterly report on Form 10-Q on file with the SEC. Any forward-looking statements are made only as of today's date, and we undertake no obligation to update these forward-looking statements to reflect subsequent events or circumstances. At this time, I would like to turn the call over to our CEO, Raul Rodriguez.
spk03: Thank you, Dolly, and thank you, everyone, for joining us on our second quarter 2021 conference call. Also joining me today are Wolfgang Dummer, our chief medical officer, Dave Santos, our chief commercial officer, and Dean Shornow, our CFO. Now beginning on slide five. During the second quarter, RIGEL continued to make good progress across all of our key value drivers, as you see on this page. While some of the headwinds of the COVID pandemic began to subside, the opportunity to address the pandemic remained very real and very near-term. We'll discuss this during our call. In ITP, we had very good growth relative to last year, as well as a substantial improvement over Q1. with a 38% increase in net sales. Dave and Dean will describe our net sales trend in more detail. Dave will also describe how we're increasing the size of our sales force to better address our heme and heme-on customers in ITP and to prepare for the potential opportunity in warm autoimmune hemolytic anemia, or AIHA. We made important progress in warm AIHA. We have now enrolled 80% of our targeted 90 patients in this trial. We added eight patients in the last three months. This enrollment progress puts us closer to our goal to be the first approved product for the treatment of warm AIHA, with the potential to capture a substantial share of this significant market opportunity. We have also made excellent progress in our COVID program with Fostermatinib, which has the potential to provide a still much needed therapy for hospitalized COVID patients. In Q2, we reported positive top line results from our phase two clinical trial conducted in collaboration with NIH and ANOVA. Wolfgang will provide a brief overview of these exciting and potentially impactful results with an update on our other COVID clinical trials. In late May, we filed the EUA with the US FDA and are awaiting their decision. Our own phase three trial in hospitalized COVID patients has enrolled very quickly. reaching over 150 patients, nearly half the targeted 308 patients, and with 90 patients enrolling in just the last two months. We are delighted to be included in the NIH-sponsored ACTIV-4 host tissue study in hospitalized patients with COVID-19 and see that the first patient has already enrolled. On our earlier programs, with our IRAC-1-4 program, We have received FDA feedback on our low-risk MDS study and have incorporated it into our Phase 1-2 study protocol. We look forward to starting this with our R289, which is a prodrug of our R835 molecule. With our RIP1 inhibitor program, we have two efforts moving forward with our partner, Lilly. We are working on entering a Phase 2 clinical study with R552, a systemic molecule, And we're also advancing our CNS penetrant molecule, which is in preclinical studies and has potential in indications such as Alzheimer's and ALS. In all, we had a very good quarter across all of our key value drivers. While we're still navigating through some of the COVID headwinds in some areas, we hope these will subside during the second half of the year. The opportunity to address what is a substantial need in COVID remains and we are committed to the patients who are suffering and the clinicians who are treating them as well. Today we'll start with Dave's discussion on our commercial progress and expansion, then followed by Wolfgang's update on our clinical programs, and then Dean's financial update. Dave, to you.
spk06: Thank you, Raul, and good afternoon. I'm happy to say that I'm on the line from the road today as I attend our summer sales meetings. It has been terrific to be able to spend time in person with the highly talented members of our commercial team, and I can report they're all quite enthused about being together with one another and their customers again. That will be a theme of my presentation this afternoon as our return to field continues and we're able to make an even greater impact on our customers and their patients. Before I begin, I would like to thank the entire commercial team for their commitment and hard work throughout the quarter to continue expanding our impact with TAVALYS. I am very proud of our return to growth in Q2. I would now like to move on to slide seven, where you will see that our FDA-approved indication is for adult patients with chronic immune thrombocytopenia, or CICP. who've had an insufficient response to a previous treatment. Moving to slide eight, we produced Q2 net product sales of $17.1 million, a 14% increase over the same quarter last year. We also achieved our highest quarterly volume to date of 1,905 bottles. While some of that bottle volume was a return to normal inventory levels in our distributors during Q2, we were very happy to see positive trends in bottles shipped to patients and clinics as the quarter progressed. The graph on the left depicts our quarterly bottles shipped to patients and clinics since 2019. So, you can compare our 2021 demand volume to last year and 2019. You will see that our demand from patients and clinics has grown in every quarter versus the prior year. In Q2, we delivered 6% sequential growth over Q1 and 12% year-over-year growth compared to Q2 of 2020. We are very encouraged by this upward momentum in demand and believe it will continue to grow as clinics reopen and we can increase our in-person engagements with customers. And why we believe that is depicted in slide nine. On the left side, you will see the progression of our Salesforce interactions through the first two quarters of this year. The blue bars represent the virtual interactions, and the orange bars are our in-person interactions. we've grown overall interactions significantly throughout this year. And the biggest driver for this is the increase in in-person interactions in Q2, where we nearly tripled the number compared to Q1. In fact, as you can see from the dark blue line, our percentage of in-person calls has grown significantly since Q1. And in Q2, it was great to see. that half of our interactions were in person. Importantly, we have significantly accelerated our in-person interactions without seeing any significant reduction in virtual interactions. Our team is doing a great job leveraging every opportunity available to make in-person sales calls, hold live speaker programs, and attend live conferences where they can see their customers. All of these interactions are contributing to broader reach among clinicians and the resulting stronger demand for Catavalese. To build on this trend, and as shown on slide 10, we made the strategic decision in Q2 to expand the size of our commercial organization to extend our reach to more customers and accelerate awareness among prescribers. particularly as we have more opportunities to see them in person. We are expanding 40% from 39 to 55 territories, giving us the capacity to call on the majority of prescribers who treat ITP and reduce travel time for our team, allowing them to call on their customers more frequently. Through market research, we continue to see physicians respond positively to the efficacy messages we have developed with Tavalise, but with our previous Salesforce size, as well as the constraints caused by the pandemic, we were not able to reach as many clinicians as we had hoped to. We believe that our Salesforce expansion will significantly improve awareness and get Tavalise top of mind for clinicians when they see a patient they're ready to start or switch therapies for IPP. You will see on the bottom of the slide that we've already made strong progress in recruiting and hiring our new team members, and we expect that all territories will be operational by the end of next month. And lastly, on slide 11, I wanted to highlight the outstanding tools we have for our sales force to spread our efficacy message, particularly in earlier lines. First, on the left, and as you may recall, We have been actively promoting our post-hoc analysis, highlighting high response rates in earlier lines. We expect that as our teams make more calls in person, the awareness and memorability of this data will continue to increase. Secondly, and importantly, we will be implementing well-researched and effective messaging based on our five-year data, showing meaningful platelet increases that are highly durable over time. In fact, 70% of patients sustained clinical benefit over time to platelet counts of 30,000 or higher, and this was seen for some patients beyond four years. We believe this will augment our existing efficacy messages nicely and look forward to seeing more and more clinicians respond with new patients' ontopolies. In summary, We are seeing demand for Tavalese increase as we see more customers with our compelling efficacy messages. By implementing our expansion with talented and experienced sales team members and equipping them with even more powerful messaging on the efficacy of Tavalese, we are well poised to accelerate growth as we move into the fall and final quarter of the year. Thanks for your attention, and I will now turn the call over to Wolfgang. Wolfgang?
spk11: Thank you, Dave. Let me start with warm autoimmune hemolytic anemia. Slide 13 gives you a brief update on our ongoing phase 3 study. Despite some continued disruptions due to COVID-19, we continue to steadily randomize patients into the trial. As Raoul mentioned, as of today, we have 80 patients randomized of our target of approximately 90. Fifty-three of those patients have already reached 24 weeks, and the vast majority of those have rolled over into the extension study as well. As we are in the final stages of enrollment, we are looking forward to the upcoming pivotal 24-week data readout. With no therapies near FDA approval, a significant unmet medical need remains, and the opportunity is large. Fos-Tamatinib is in the advanced stages of phase three development and would be the first to market in this indication. And as a reminder, Fos-Tamatinib has FDA fast track as well as orphan drug designation. Let's now switch gears to our COVID program for Fos-Tamatinib. Slide 15. A little over a year ago, we began to explore the potential of Fos-Tamatinib as a treatment for COVID-19. It started with external research from the University of Amsterdam, as well as MIT and Harvard, which provided compelling experimental evidence that Fostermatinib might be beneficial in COVID-19 disease. That had raised strong interest by external clinical institutions, such as the NIH, NHLBI, and the Imperial College of London to take Fostermatinib into COVID-19 patients. We've shared with you the positive outcome from the NIH-sponsored Phase II in April. Based on that data, we have filed for an emergency use authorization late May, which is currently under review. We also have a RIGEL-sponsored Phase III study ongoing, which is progressing well. An update on that later. And on top of that, the NIH has chosen Fosdamatinib as one arm in a large randomized Phase III trial called ACTIV-IV, to provide additional data on post-dermatitis in severe hospitalized patients. As we can all see with new virus variants evolving and vaccination rates plateauing, there remains a clear need for options to treat COVID-19 disease and improve outcomes for hospitalized patients. Slide 16 shows you the various patient population covered with our clinical program. The recent data from the NIH included patients with a five, six, or seven rating on the widely used eight-point ordinal scale, which are the most severe patients. That is of special interest because these patients are presumably the hardest to treat. The newly initiated ACTIV-4 host tissue phase three study covers a similar patient population. The Imperial College of London study in our phase three clinical trial will include milder patients with scores in the three, four, and five range, and will investigate if Fostermatinib can prevent progression of mild patients to severe disease. So these clinical trials are evaluating Fostermatinib in a wide range of COVID-19 patient populations. Let me remind you of the key takeaways from the recently completed Phase II NIH study on slide 17. The study enrolled 59 patients, randomized one-to-one to Fostermatinib plus standard of care versus placebo plus standard of care. The primary endpoint was safety as measured by the incidence of serious adverse events. To fully appreciate the primary outcome, you need to remember that the first question in the study was, is it safe to add Fostermatinib on top of standard of care, such as dexamethasone and remdesivir? Given Fostermatinib's favorable safety profile, the hypothesis was that the rate of serious AEs in both groups would be about the same or similar, which would have met the safety goals already. However, the incidence of SAEs turned out to be cut in half in the Fostermatinib group compared to standard of care alone. Given that several of the SAEs in the standard of care group were COVID-relevant hypoxemia events, this improved safety outcome is already a good surrogate for efficacy. There were three deaths in this trial. All three occurred in the standard of care alone group. There were no deaths in the post-tumor group. It is also worth noting that there were four patients, two in each arm, who entered the study intubated and on mechanical ventilation. The two patients in the placebo group both deceased, while the two patients on ventilation, the post-Tamatinib group, could be extubated and survived. That is quite remarkable given the high likelihood of death once a patient needs to be intubated and mechanically ventilated. There were multiple other secondary efficacy endpoints in the study, and I can tell you that they are all consistently favoring postarmatinib, such as improvement in ordinal scale, days on oxygen, as well as number of days in the intensive care unit. And finally, the clinical findings were also consistent with improvement in objective lab measures, such as mitosis, seroactive protein, ferritin, or D-dimer. We see quite beautiful improvements in these biomarkers, which are well accepted as relevant to indicate inflammation and blood clotting in COVID-19 patients. And as I said, all these effects are in addition to remdesivir and dexamethasone, which is remarkable. On slide 18, you see more detail on our Rigel-led Phase III study. The study includes hospitalized patients with mild disease who have certain risk factors to develop more severe disease. If positive, this trial could be the basis for potential label extension for Fostermatinib to treat patients with COVID-19. The study is conducted at approximately 30 sites in the US and South America, where COVID continues to be a big issue. The study is enrolling rapidly, and as of now, we have over 150 patients enrolled. We currently expect to complete enrollment before the end of the year. On slide 19, you can see an overview of the NIH ACTIV-IV trial. As we announced in late June, Fos-Tamatinib was selected for this study. The trial is evaluating four different treatments, including Fos-Tamatinib in hospitalized patients with COVID-19. The patient population is similar to the NIH Phase II study that I showed you earlier, and will enroll approximately 300 patients in each form. The master protocol is designed to be flexible to allow for stopping and adding of new therapies based on preplanned utility analysis in each arm. The trial will be run at more than 50 sites and is currently recruiting patients. The first patient treated was announced by the NIH on July 22nd. So in summary on slide 20, We have the completed NIH Phase II study with the data having been submitted to a peer-reviewed journal. Rachel submitted an EUA in late May, and we are awaiting a decision from FDA. Our Phase III study continues to enroll patients and has already over 150 patients enrolled to date. The NIH Active 4 host tissue study has started and is recruiting patients. And the Imperial College of London MADIS investigator-sponsored Phase II study is ongoing and has enrolled about 125 patients so far. These studies will generate a lot more data, which will be incredibly valuable for exploring Fos-Tamatinib in influenza or other non-COVID-related acute respiratory distress syndromes. So now let's turn to our pipeline programs, IRAC1-4 and RIP-1. Slide 22. The IRAC1 and 4 pathways are promising targets in inflammation-driven autoimmune diseases, as well as certain heme-onc conditions like low-risk MDS. R835 is a dual inhibitor of both IRAC1 and 4, which in preclinical study showed more complete suppression of inflammation compared to a selective inhibitor of IRAC4 only. As discussed previously, we believe the IRAC won four pathways or ideal targets for treatment of low-risk MDS, which is caused by inflammation in the bone marrow that leads to bone marrow deficiency and cytopenia. Slide 23. With R835, we have generated initial proof-of-concept data with an LPS challenge in healthy human volunteers. there was profound inhibition of LPS-induced inflammatory cytokine production, such as IL-6, TNF-alpha, or IL-8. Moreover, R835 was well-tolerated in the single ascending dose and multiple ascending dose study and had a linear PK profile and dose-proportional exposure. Slide 24. In order to improve oral bioavailability and clinical exposure levels, We utilized our previous expertise with Tavalis and created a prodrug of R835 called R289. We have now completed single ascending dose and multiple ascending dose phase one studies with the new molecule. As expected, R289 was well tolerated in healthy volunteers and the PK, PD, target plasma drug exposure levels and safety results were comparable to our Phase I results with R835. We presented the data to the FDA in a pre-IND package and received good feedback on our proposed Phase I study design for low-risk MDS. So what's next? We are incorporating the FDA feedback into our clinical development program and plan to move into the clinic with this Phase I-II study in low-risk MDS. Additionally, we are continuing to explore indications in rare autoimmune disease, such as palmoplantar pustulosis, hidradenitis superativa, and others. So, we are very excited about our progress with IRAC. Slide 25. We also wanted to update you on a new research collaboration with the MD Anderson Cancer Research Institute. with the goal to evaluate R289 and R835 in cell cultures and animal models of MDS in chronic myelomonocytic leukemia. This translational research will add further to the body of data generated to date for our IRAC program. We're very excited to be working with Dr. Guillermo Garcia-Manero's team at MD Anderson, and they are recognized leaders in hematologic cancer research and we look forward to exploring opportunities for clinical collaborations as well. I'll conclude with slide 26. Another very important value driver for Rigel is our RIP1 inhibitor program that we have partnered with Lilly. The first candidate, R552, is an oral systemic RIP1 inhibitor for inflammatory conditions. We are working closely with Lilly on planning for the first Phase II study in an autoimmune indication. In addition, here at Rigel, we are working on selecting a RIP1 inhibitor candidate that can cross the blood-brain barrier. Lilly will then lead the clinical development of the brain-penetrating RIP1 inhibitors in CNS diseases. We're very excited about the broad potential for RIP1 inhibitors in numerous surge indications And Lilly is the ideal partner to have with their huge expertise in developing therapies for all the immune and CNS diseases. With that, I'd like to turn to Dean for finance update. Dean?
spk09: Thank you, Wolfgang. I'm on slide 28. For the second quarter of 2021, we shipped 1,905 bottles to our specialty distributors. resulting in $22.1 million of gross product sales. 1,693 of those bottles were shipped to patients and clinics, while 961 bottles remained in our distribution channels at the end of the quarter. We reported net product sales from Tavolis of $17.1 million, a 14% increase compared to the second quarter of 2020. Our net product sales from Tavolis were recorded net of estimated discounts, chargebacks, rebates, returns, copay assistance, and other allowances of $5 million. Our gross to net adjustment was approximately 22.6% of gross product sales. Before we move on from net product sales, let me review our expectations for the third quarter of 2021. We expect to see continued growth in the third quarter in bottles shipped to patients and clinics, similar to what we saw in the second quarter. Once our Salesforce expansion is completed towards the end of the third quarter, and assuming that access to physicians and patients continues to expand, we expect to see an acceleration of sales in the fourth quarter. Incrementally, we currently expect our gross to net adjustment to be approximately 23% or 24% in the third quarter of 2021. Moving on to the next slide. In addition to net product sales, Rigel's contract revenues from collaborations were $3.7 million for the three months ended June 30, 2021, which consisted of revenues recognized from our deferred revenues of $3.3 million from our license agreement with Lilly and $400,000 related to the performance of certain research and development services pursuant to our collaboration with Griffles. Government contract revenues of $5.5 million was related to income we recognized, pursuant to our agreement with the U.S. Department of Defense for our ongoing Phase III clinical trial of Fosfamatinib in COVID-19. Moving on to costs and expenses, our cost of product sales was approximately $129,000 for the second quarter of 2021. Total costs and expenses were $39.3 million in the second quarter of 2021 versus $33.4 million in the second quarter of 2020. The net increase in costs was primarily due to increases in personnel-related costs, stock-based compensation expense, and research and development costs related to our various ongoing clinical studies. Given our Salesforce expansion, and certain preparations for potential EUA, we expect total costs and expenses for the remainder of the year to increase. As we gain clarity on the timing of a potential EUA approval, we'll provide appropriate updates. Finally, we ended the quarter with cash, cash equivalents, and short-term investments of $153.4 million. With that, I'd like to turn the call back over to Raul. Raul?
spk03: Thank you, Dean. I am very proud of the progress in the last quarter, and we have some exciting milestones that we're working towards in the second half of the year. In ITP, we look forward to accelerating our in-person interaction with our expanded sales team and reaching more prescribers as the clinics open to patients. These interactions provide the opportunity to educate on earlier line use and, as Dave pointed out, on the important durability of our product. keeping TAVA leads top of mind as clinicians help patients make decisions about starting new therapies. In AIHA, we expect to complete enrollment in our Phase III clinical trial later this year. We are getting close. Fosamatinib has the potential to meaningfully improve care in this rare disease and to provide a new therapy for patients suffering from warm AIHA. Currently, there are no approved therapies for this indication. giving Rigel the opportunity to be first to market and a leader in the space. In COVID-19, Fostermathem has the potential to address some of the most damaging complications of this disease. We look forward to a decision on our EUA application and completing enrollment of our phase three clinical trial, which as we mentioned, is enrolling rapidly. We are very encouraged by our results to date and are working diligently to bring this therapy to patients. In addition to our programs with TAVA leads for Fostermatinib, we are excited about the potential of our earlier stage programs, IRAC1-4 and RIP-1. We look forward to supporting Lilly in the development of our RIP-1 program as we advance R552 into phase two trials, and we select the brain penetrating candidate for our CNS indications. Our wholly-owned IRAC4 molecule, R289, has tremendous potential in hemat and autoimmune diseases, and we are currently planning on the first of these trials in low-risk MDS. We have numerous exciting milestones to look forward to, including some in the very near future. With that, let's open up the call to your questions.
spk10: Thank you. At this time, we'll be conducting a question-and-answer session. If you would like to ask a question, please press star one on your telephone keypad. A confirmation tone will indicate your line is in the question queue. You may press star two if you would like to remove your question from the queue. For participants using speaker equipment, it may be necessary to pick up your handset before pressing the star keys. One moment please while we pull for questions. Our first question today is from Yigal Nacho Mobitz of Citigroup. Please proceed with your question.
spk02: Hi, great. Thank you very much for taking the questions, and hi, Roland team. I'm curious what the FDA receptivity has been to the EUA discussions based on your favorable Phase II data in the 60-patient trial, as well as the ongoing Phase III that's enrolling 200 patients. Obviously, those enrollment figures are several orders of magnitude less than the Phase III enrollments. for the trials that supported the EUAs for the mRNA vaccine. So just curious, you know, how you're thinking about that discrepancy. Thank you.
spk03: Yeah. I'll let Wolfgang comment on FDA reaction expectations, and then I'll also add some color commentary after that.
spk08: Wolfgang?
spk11: Yeah. So interesting question. We have worked very closely with the FDA and inquired whether it makes sense to submit an EUA. They did welcome that, so we did submit the EUA. I cannot exactly tell you how the FDA is currently thinking because we're not getting constant updates from them. So I can only give you my personal opinion. A, you are correct. Other EUA-approved drugs had much larger sample sizes. So our data set is relatively small with 60 patients, but it's double-blind and placebo-controlled. And the safety as well as the clinical efficacy data look, from an effect size standpoint, very, very strong and very favorable. And if you do your homework and look at some of the endpoints and compare the effect sizes with some of the EUA-approved compounds, Fostermatinib does look very favorable. But in essence, your question does remain a review issue at this point.
spk03: Keep in mind the EUA is intended to be that, an emergency use and a temporary until your own larger data comes forward. and that is coming in the not-too-distant future. So I think this is appropriate for an EUA type of review. Again, it doesn't mean we'll get a yes or certainly we'll get a no as yet, but it's still being reviewed by the FDA.
spk02: Okay, thanks, Raul. And then I just had a bit of a housekeeping question regarding the Phase II vaccines. ICL slash Mattis trial. I just noticed that in your prior slides, the eligibility for that trial was points three and four on the eight-point ordinal scale, but I think that shifted, did it not? That in today's slides, the Mattis trial shows eligibility spanning points four and five on that eight-point ordinal scale. So am I correct? Was there a change in the enrollment criteria for this one?
spk03: I'll let Wolfgang answer that, but I think the answer is clear. Go ahead, Wolfgang.
spk11: Yeah, it's a very, very sharp observation. The answer is no, there was no change in enrollment criteria. They're just the same. But it's a little bit of an artifact on this scale because the Imperial College of London uses a slightly different scale. And we used to... think it's the equivalent of five, but now it has shifted one, but simply due to the use of a slightly different scale that they're using.
spk02: I see. Got it.
spk03: So this is an accurate representation.
spk02: Okay. Got it. And then just the last question I had on the IRAC14, what is the thinking behind the need to do a pro-drug formulation of R835 versus not? Thank you.
spk11: Sure. Okay. Yeah, so as you know, we've shown you a lot of data with 835, which is a great molecule. We had preclinical experiments done with 835 as well as the phase one healthy human volunteers. But it turns out that 289, which is cleaved and then results in release of 835, has much better bioavailability and less variability in patients, so it's clearly a better compound to administer 835 to the patient. The active metabolite is still 835, so all the data that we have generated with 835 are still relevant, but it's a drug administration advantage for 289.
spk03: And we were waiting to hear also from the FDA on 289, and they were in agreement that giving us the green light to proceed with this low-risk MDS study with 289.
spk02: Got it. Thank you, Raul and team.
spk03: Thank you, Igor.
spk10: The next question is from Chris Raymond of Piper Sandler. Please proceed with your question.
spk05: Hi. This is Nicole Gabreski on for Chris. Congrats on the quarter, and thanks for taking our question. I guess maybe one on Kavalise. So we're starting to hear more about potential commercial headwinds now with the Delta variant surging. I guess for your Kavalise growth expectations throughout the remainder of the year, does that take into account any potential COVID impacts or is it still too early on that front?
spk03: Thank you, Nicole. I'll ask Dave to comment on that.
spk06: Hi, Nicole. This is Dave. From a standpoint of COVID Delta variant kind of affecting our ability moving forward, you know, I think we've been at least very through the very rough storm of 2020 when things were locked down and it was very difficult to go anywhere, as you know. And when you compare that to kind of where we are now, where, yes, you do have a Delta variant, but Things aren't locked down. People are continuing to get out. We believe it can't get any worse than what it had been in 2020, particularly before the vaccinations were out there. And so we do think that we have a great opportunity ahead of us to increase the noise level out there with Tavalese. It is an unknown still, obviously, in terms of how much everything will open up But if the last quarter is any kind of marker for that, we did see a lot more in-person interactions, and we were able to make more impactful calls, both in sales calls and speaker programs in particular, and even seeing people at conferences. And by the way, you know, ASH this year is a hybrid model, but there will be, at least at this point, a live conference in December for ASH. which, you know, I think is part of our planning as well. We want to be prepared for that. So I hope that helps.
spk05: Yeah, yeah, that's definitely helpful.
spk06: And then I guess maybe just... I do want to add one other thing. The folks we are bringing on in this expansion, because as I told you, we're already on our way with the expansion. Of the folks that we've already hired or who've accepted offers, we have an average of 14 years of HEMOC experience, which... I think it's going to help us a lot in seeing clinicians either virtually or live. And you have to remember with our previous Salesforce size of 39 when we brought people on they usually were ending up calling on more customers than they used to in their previous or bigger geographies than they used to in their previous roles at an oncology company. So this really helps us to really be able, as I said, to see more customers and see them more frequently and hopefully be familiar with those customers, even with the new people coming in.
spk05: Okay. That's very helpful. Thank you. And then maybe just a quick second question on your ongoing COVID studies. I just wanted to ask if patients are being screened for viral strains. And I guess I'm just kind of curious if there might be any differences in response to Fostamatinib treatment that could be dependent on COVID strain, just especially now with the Delta variant becoming dominant. So any thoughts or color here would be great.
spk03: Sure. Wolfgang, if you would comment on that.
spk11: Yeah, the answer is no. There is no screening for the variant at baseline. But I would say I would be optimistic that the mechanism of action for Fostermatinib in COVID-19 is independent of the strain because the pathophysiology continues to be respiratory distress and respiratory problems in this patient as well as a there's a tendency to get blood clotting in larger vessels as well as in the smaller vessels, which leads to, you know, the renal failure and to other organ damage. And those should be inhibited with Fosdamatinib independent on what kind of variant we are dealing with.
spk05: Okay. Also very helpful. Thank you very much.
spk10: Thank you, Nicole. The next question is from Gary Mathen of BMO Capital Markets. Please proceed with your question.
spk08: Hi, this is Edwin Hua filling in for Gary Mathen. Thanks for taking my question. So my first question for Tavolis and COVID-19, has there been any more progress with potential partners or discussions with regulatory authorities for ex-US in terms of COVID? And secondly, How do you view the opportunity now, especially with the increase in hospitalizations from the Delta variant? Thanks.
spk03: Maybe I'll take a stab at the first of those, Wolfgang, and you take the latter. I'd say the U.S. opportunity is substantial, as you may imagine. I think we're more advanced in the U.S. simply because we've been on the market. We're a well-known entity here. where we have a significant safety database with our product here in the U.S., and that's been our main and first focus. But the opportunity with our partners exists, and we're certainly discussing it with them and would move forward in those other territories as well to provide the product. The U.S., fortunately, is the regulatory authorities move rather quickly relative to other countries, so it is the first priority for us.
spk11: Your second part of the question was around increasing hospitalizations. Yes, indeed. There was a concern, depending on how you look at it. We thought maybe the case numbers go down. Now it turns out we have a new variant, which is very contagious. It turns out that only certain areas in the United States have very high vaccination rates, while other areas have very small vaccination rates. This is where the cases go up. I firmly believe that the issue is going to continue to stick around for quite a while with the Delta variant, and nobody can predictive certainty what comes after that. We have already heard about a Lambda variant in South America. So I believe there is a continued need for something that treats the disease effectively. Even though we have vaccinations now, but a lot of people are not vaccinated and still get sick and they need treatment. And we hope we're going to be able to provide that.
spk08: Thanks for the call, then.
spk10: Thank you. The next question is from Yuen Yang of Jefferies. Please proceed with your question.
spk00: Hi, this is for Yuen. I have two questions, please. Number one, for WHA, would it be reasonable to assume enrollment completion by around mid for Q21 based on the most recent enrollment rates of around two to three patients per month?
spk03: I could take a step at that. You know, it's hard to project. And in the past, we've had months where we had more than two to three a month and months where we had less than two to three a month. And it really is dependent on lots of things, mainly COVID-driven. And so it's hard to project exactly when it will enroll, but we think later this year is the answer. Keep in mind the following. Many of our sites, we have sites in the U.S. and we have sites in Europe. The preponderance are European. And I do note that in Europe, there's a higher vaccination rates now than in the U.S. So we're confident that that will help in terms of recruitment, in terms of patients going out there and seeing their doctors more frequently. So while it's hard to predict exactly the months, but we do know it's in the not too distant future. We only have approximately 10 more patients to go. It's just not that many.
spk00: Thank you. And for the second question, for phase 3 and COVID-19, could you please provide a more defined timeline for data readout before year end 21? It looks like it took about seven months to enroll 50% of the patients. So So we're probably expecting accelerated enrollment. So how many percent of the sites have been activated so far?
spk03: Yeah, I think on the COVID side, we've actually enrolled very quickly. In the last two months, I think we've enrolled 90 patients. That's about a patient and a half a day. And so we started slowly when we initially started, but there's been a real acceleration, particularly as we've gone to Latin America, Brazil, and Argentina, And as you may know, the pandemic is raging in those countries, unfortunately, for them. It has helped enrollment tremendously, though, in terms of contributing patients to those. The U.S. sites as well. And so we expect to have enrollment completed, as Wolfgang said, by the end of this calendar year. Exactly the month is, again, a little bit difficult to say because we don't know the trajectory of the pandemic, kind of in reverse of what I said earlier on AIHA. But it's certainly not subsiding in the countries we're in, Brazil and Argentina in particular. And in the U.S., if anything, it's increasing in the short term. And we think that will continue to maintain that very brisk rate of enrollment, 90 in two months, and we have 150 patients to go. So it gives you some estimate of that.
spk00: I've got it. And if I may ask one more question, please. So... it looks like a lot of the patients may come from South America. Are there standards, would the standard of care in those countries be different from in the U.S.? And how are you thinking about how that would affect the results? Thank you.
spk03: Alice, we'll scan the comment, but I will make a comment. Many other products that are applied, have applied, have received EUA approvals, have done trials primarily outside of the U.S. in terms of this pandemic, which I think bodes well for us. But maybe, Wolfgang, do you want to comment in terms of standard of care U.S. versus, say, Latin America?
spk11: Yeah, I would say the only... So dexamethasone, as you know, is widely used, and that is cheap and available everywhere in the world, and that is also widely used in Latin America where we're conducting our study. Maybe there might be some less use of remdesivir, which is not as widely available in South America, but we are stratifying for that, so we shouldn't have an imbalance here. In our treatment arms where all of the remdesivir patients are in one arm and all of the not remdesivir are in the other arm, no, there's going to be equal percentages. Also, you know, if you look at the standalone remdesivir data in hospitalized patients, it is really, you know, the effect is modest at best. I consider the effect modest at best. So I do not really believe that a patient getting remdesivir versus not getting remdesivir is a dramatically different patient. So I'm very little concerned about this potential issue.
spk00: Thank you very much.
spk11: Thank you.
spk10: The next question is from Kristen Kluska of Cantor Fitzgerald. Please proceed with your question.
spk04: Hi, good afternoon everyone. Thanks for taking the questions. So the first is on TAVALYs. You've collected a lot of post hoc analysis data outside of just the earlier line response rates, but also at ISTH you showed a nice correlation with platelet counts along with reduced bleeding events and rescue therapy. And then I know in the past you've also had some data about the side effect profile lessening over time. So I just wanted to ask collectively, as you've conducted more of this work along with the trial and some of your new marketing efforts, how do you believe that this is going to help you achieve not just earlier line usage but also prolonged usage as well? And talk specifically about these new sales reps in the new territories and especially since they'll be going out with this message for the first time versus when you initially launched.
spk03: Absolutely. Kristen, thank you for the question. That's a very good one. I'll ask Dave to comment on that in terms of his thinking in terms of the various data he outlined today for you and, you know, the new reps and what they're going to use as a lead item as they introduce themselves to clinicians. Dave?
spk06: Yeah, thanks for the question, Kristen. I think it is a great one. because it's exactly why we are expanding and it's exactly what we've seen in our research as we talk to clinicians in different forms, both in advisory boards as well as in more traditional market research. And so the things that really appeal to them are our mechanism, because it is different, it goes right to the cause of low platelets in patients, and of course the safety and efficacy. And what we've really kind of focused on now is how do we make that efficacy message stronger? And as you said, our postdoc analysis on the early line data is, you know, while it has been out since the beginning of 2020, we, as you heard, we're just not able to reach as many clinicians as we'd like. And once they hear that data, they are quite surprised that our efficacy rates, our response rates are that high in the earlier lines. But then now we're able to add this kind of durable benefit for the majority of patients, either getting over 50,000 platelet level or getting over 30,000, which many of them think is clinically meaningful. And when you add that piece on there, that 70% of patients can reach that clinically meaningful level of 30,000 and have a durable benefit over time, it really does ring true. And so what we're doing is we're using both of these tools. the BJH publication as well as this five-year efficacy and safety analysis to really get out there strong in terms of when they see a patient that they want to start post-steroids or switch, they really have an opportunity with Tavalise. We hear it over and over again that docs, when they hear about it, they try it and they have a good experience. This drug is a safe drug, been used a lot in other areas, and is very safe. And in ITP, very effective. And so it was funny. We were just talking about it at a meeting today. I guess it's a drug that is easy for them to give. They just give it twice a day, and they can watch their patients continue to build their platelet counts. and have durable responses over time. That's exactly what the new reps are going to do. We're going to have them trained in this area and they're going to be kind of relaunching what we've had before with the early lifeline data and we just trained our entire sales force on the five year efficacy and safety analysis with the durable benefit and we think that message will ring true when it's out there and it's going to be in our speaker programs, everything that we're doing to get the message out there.
spk04: Great. Thank you. And just a quick follow-up on that. Can you talk a little bit more about the new 16 territories and specifically what criteria went into choosing these? I think it says in the slides that some of these are smaller territories. So how are you thinking about things like competitive positioning?
spk06: We chose the 16 territories based on the number of prescribers in a territory as well as the opportunities. in terms of CITP claims that are there in the territory. So it's a mix of potential as well as the prescribers and we balanced all of the territories across the 55 as best as we could. But it makes it much more, many of our territories that were existing before of the 39 were just simply very large geographies. That was difficult to get that frequency that you would like to have on some of the territories key prescribers in the territory. And so what we've done is we've reduced the size of some of these large geographies pretty dramatically with this increase in size of the Salesforce. I hope that makes sense.
spk04: Yes, thanks. Appreciate that.
spk10: The next question is from Joe Penkinis of HC Wainwright. Please proceed with your question.
spk07: Hey guys, good afternoon. I have two quick, I guess, logistical questions on COVID and then one on ITP. So on the COVID front, I was just curious regarding ACTIV-4 and when you look at the ordinal scale, and I guess a little bit of a difference, if it's different or is it just a wording difference with regard to the primary endpoint? So when you talk about ACTIV-4 in your slides here, it's, you know, between five and seven. but the endpoint says requiring supplemental oxygen by day 28, whereas something like Active 5 has a primary endpoint of survival without ventilation at day 28, even though you're really covering the three numbers there. I was just curious if there's differences.
spk03: Yeah, Wolfgang, if you would take that, I could also add in.
spk11: Yeah, so when I say... The population is similar to NIH. You are correct. It's not identical because the ACTIV-4 isn't using that ordinal scale as the inclusion criteria. They have other criteria like a certain degree of respiratory failure and things like that. But in essence, these are patients that are hospitalized and they need oxygen supplementation. So they're quite similar. To your point regarding the oxygen endpoint, indeed, that is one that's not always been used, but it has been used increasingly in these NIH studies and also by others. And therefore, they have selected this as an endpoint that they think is reliably measurable, is sensitive, and is clinically meaningful. But your comments are appropriate and accurate.
spk07: Got it, got it. And then with regard to your phase three, obviously you said it's US and South America. I was just curious, can you provide any sort of approximate proportion between the two regions of enrolled patients?
spk11: Yeah, the majority I can share with you right now is coming from South America. just simply due to the incidence of the disease in these areas. But we do get patients from our USAIDs as well.
spk07: Got it, got it. And then my ITP question, it still might be a little early to ask this, but it's very nice to hear about the Salesforce expansion as well as the increased face-to-face meetings, so that's very good to hear. I guess I would ask, again, might be too early, do you have any anecdotes or feedback to share from the field now with regard to physician or nurse practitioner or nurse receptivity to the earlier stage data?
spk03: Dave, do you want to take a stab at this?
spk06: Sure. Actually, it's a timely question because I am here with the team, and We were just kind of going through, you know, some of these promotional items that I've talked to you about. And they were talking about how when they are able to get in front of a doc and present the message and really, you know, get that out there in front of them, they are enthusiastic about it. And, again, we see this over and over in research forums as well. You know, docs have really no issues with tablis. when they look at the data that's there, it's really just, as I said on the last call, it's an issue of habit, and they just need to have Talaly's top mind when they see a patient that they're ready to start or switch, and that's what we're doing. As you know, there are 24,000 patients out there post-steroids, and if you just even imagine a fraction of them at any given time ready to start or switch therapies, Not to mention all the patients who are watchful waiting that could cycle in and out. It's a lot of opportunity out there. And so we just need to be out there more with the message that stays top of mind, so when the clinician sees that patient, they're ready to pull the trigger with top of lease. I really believe in that, and that's why we did expand the sales force, and we are getting good feedback on those efficacy messages.
spk07: Got it, guys. Thanks for the feedback.
spk10: Thank you, Joe. That's all the time we have for questions today. I would like to turn the floor back over to Mr. Raul Rodriguez for closing comments.
spk03: Thank you, everyone. Thank you for those questions. Very much appreciated. I'd like to just take the opportunity to thank our employees. This has been a challenging time for all of us, and they've done an incredible job in exploring the potential for the use of Fostermatinib, Tavalis, and AIHA in COVID, and allowing or educating doctors about the use in ITP. All of that work, you know, difficult to do during these conditions, but they persevered in that, and I'd like to thank them for that. I think we've made very good progress this past quarter, and we have some incredible milestones coming in the short term that I think will reveal the utility of our product for that. And so I'd like to, with that, thank you for your participation and interest in Rigel, and we certainly look forward to giving you further updates in the near term. Take care.
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