Idorsia Pharmaceuticals Ltd

Good afternoon, good morning all, and welcome to the first half conference call to discuss our reporting. With me on the call today are our CEO, Jean-Paul Cosell, and our Chief Financial Officer, Andre Muller. They're both here to give additional granularity to the reporting that we did this morning and will be hosting the prepared remarks. Further, we'll be hosting a Q&A session where our general manager and president of the U.S. organization, Patti Tor, and our president of European and Canadian regions, Jean-Yves Chaflon, will be joining us. Next slide. As customary, before handing over the microphone, I need to remind everybody that we will be making forward-looking statements. We have therefore been appropriately warned about the risks and opportunities of investing in Adorsia shares. With that, I hand over to Jean-Paul. Jean-Paul, the floor is yours. Next slide.

Good morning. Good afternoon, everyone. Many things are happening today at IDOSIA. We are working very hard with the FDA and the MEA to have approval. But today, I will first focus on the society that we announced just last week, the cost reduction initiative, and then I will describe to you the progress we are making with COVID-19. Then, André will take you through our financial results. Next slide. Just last Thursday, we announced the sale of our operating businesses in the Asia-Pacific, ex-China region, to Societaires for a total consideration of 400 million Swiss francs. The transaction includes the acquisition of Eidosia affiliates in Japan and South Korea, the assignment of the license for PIVLAS in the Asia-Pacific region, and the co-exclusive license for Daridorexan in the region, together with the assignment of all potential milestones in connection with the license granted to Mochida. The transaction also includes an option for Sotae, upon payment of separate option fees to license and for the development and commercialization in the territory. The transaction created value for both companies while maintaining our ability to develop our drugs for patients in the region. Importantly, it brought cash that has given us some breathing space to adapt our company. Next slide. In order to give us the time we need to realize commercial success, any funds that are secured must be prioritized for activities that maximize their return in the near term. To this end, we are launching a cost reduction initiative with a target of reducing cash burn at headquarters by approximately 50%. then become fully effective in early 2024. I'm very sorry to say that in order to achieve the required savings, up to 500 positions at headquarters, mainly in research and development, and the associated support function could potentially become redundant. The cost reduction initiative is dependent on the full portfolio review potential out-licensing deal, and an employee representative consultation in Switzerland. Since our immediate objective is to maximize the time the company has to deliver commercial success, now let's take a look at the progress being made with QVD. So let's start with the summary. Next slide, sorry. Next slide, so. Let's start with a summary of the U.S. performance by looking at what has been achieved in the insomnia market and focus on the immediate priority for the team. Our approach at launch was to drive demand for Qubedix. This was necessary for early product adoption and payer negotiations. In January, ESI added QVBIC to the national preferred formulary. This was followed by CVS national coverage, as announced in July, which significantly increases affordable access to QVBIC for the 20 million lives that CVS covers. To begin, QVBIC is in Tier 3, But we expect the Q-Vivix will be in Tier 2 at parity with the other vaccine receptor antagonists by early Q4. And as our access continues to improve, this means more prescription will be coming through the retail channel and will be paid prescription. Now that we have the product demand and solid commercial coverage, we are moving away from the consignment model and accelerating our retail dispensing. You will see this in the next slide. We anticipate Medicare Part D access in Q1 2024. This would open 33% of the overall insomnia market, allowing us to compare more broadly in the entire market. The elderly population is also a very important patient group for QBV, as the rates of insomnia are higher than in the general population. And our product efficacy and safety data is consistent in this population. Next slide. So let's look at the demand for QBV. QBV demand has continued to grow quarter after quarter since launch. They are about 60, in 2022, they were about 65,000 cubic prescriptions. While in just the first half of this year, they were approximately 125,000 prescription dispensed, representing an increase of more than 85%. The right-hand chart is showing the channel where the prescriptions are dispensed In the last quarter, we see a shift from a consignment model which we used to drive demand to a retail model. This movement represents an important trend that we expect will accelerate as our market access position continues to grow and will enable us to pursue more paid scripts. Next slide. Importantly, we see our refill increase, validating that patients have a positive experience with Tuvidix. As insomnia is a chronic condition for many, strong refill rates are fundamental to positive patient outcomes and long-term growth of the product. We will continue our educational efforts for both physicians and patients, and specifically Specifically, we are working of setting the right expectation, really explaining to the patient that they have to take it every, they take QVB every night to get the maximum benefit. We are going to explain safety profile of QVB and, of course, the specificity of the unique pharmacokinetic profile of QVB. We continue to evaluate our Salesforce footprint, and we have moved from approximately 400 sales representatives at the start of the year to 325 as of July 1st. And we have now crossed 30,000 total writers of query links since launch. While we have opportunity to further expand the number of new writers, we are focusing on transitioning current 2-Vivic trialists to loyalists, driving more depth in prescribing. Next slide. Now let's move to Europe and look at the great progress being made with the launch or the launch preparation as well as with securing access and reimbursement. As you know, we launched in both Germany and Italy in November 2022. In Germany, we are engaged with authorities in two parallel processes. First, the Amnok pricing and reimbursement process for the first four weeks of treatment. And we are expecting the outcome of this first negotiation by the end of the year. But in parallel, as you know, prescriptions of sipping medication in Germany are limited to four weeks. And we are, there is a GBA review to allow QVV for chronic use more than four weeks. And we should hear about this process at the end of Q3 this year. If this four-week limitation for QVBIC is lifted, we plan to submit a second AMLOG dossier for the treatment of chronic insomnia beyond four weeks. reflecting the indication in chronic insomnia disorder granted by ZMEA in 2022. In Italy, QVBIC was launched in the self-pay market, noting that no sleep therapy is reimbursed in Italy, with prescriptions limited to neurologists, psychiatrists, and specialists from sleep centers. A reimbursement and general practitioner expansion dossier was submitted in Q2 2023. In Switzerland, the reimbursement dossier for QVVIC was submitted in November 22, and the review is ongoing. While we are waiting for the reimbursement, which is anticipated for the end of this year, QVVIC was launched in the self-pay market. In the UK, The NICE review is in progress, and we expect to launch QBVIC by the end of 2023. And in Spain, we will make QBVIC available in the self-pay market also by the end of this year. And we are currently evaluating the best way to demonstrate the value to payers in this market. In France, the Transparency Commission recognized through an ACMR-4 rating that QVDIC brings another value to the current treatment landscape of patients with chronic insomnia. After CBT-I, for patients who do not have access to CBT-I, QVDIC will be the only available and recommended treatment for chronic insomnia disorder. In France, in addition, with the rating of the clinical benefit, which has been granted by the Transparency Commission, this rating would lead reimbursement without copay for 95% of patients covered by public and private health insurance in France. We anticipate a commercial launch in the first part of 2024. And last but not least, Following approval by Health Canada in April, we plan to submit QBV for reimbursement by private payers by the end of the year with the commercial launch anticipated in the first part of 2024. Next slide. Let's look a little closer to the demand dynamics in the European market. After a little more than six months on the German market, we are pleased to see a constant growing demand for QVD. Our in-team field, the teams, our reps, are coding on both the specialists and the primary care physicians. We pay particular attention to the specialists, such as the sleep center, psychiatrists, neurologists, who have more time for their patient and we can set the right expectation for gaining the best experience and the benefits of QVD. This strategy brings greater depths of prescription as well as more repeat prescription. We are also, in Germany, building on the experience of the 20 expert centers who have contributed to the enrollment of more than 800 patients in the registration study. Next slide. We see the same constant growing demand for tubulic in Italy after six months on the market. Here we call on specialists only. And we are making sure to explain to this patient the benefits of Tubivic and really the need for chronic treatment. This is extremely important to have this explanation since the drug is fully saved by the patient. We are happy with the engagement that our Italian team has been able to build with a community of specialists in such a short time. That brings me to the end of the overview, and now I will hand over to André to work you through the financial. Next slide.

Thank you, Jean-Paul. Good afternoon or good morning to everyone. As Jean-Paul alluded to it, we are more than happy that we managed to close this transaction with Soce regarding the APAC ex-China business because it extends actually our runway to early 2024. And to be very clear, we do not want to be in the same position, I would call it the back to square one, By the end of the year, and to this extent, there are several initiatives which are ongoing to raise additional cash in the second half of 2023. One of them, and also Jean-Paul mentioned it, is to reduce our cost base. The reason for it is that we want that any amount of cash that will be raised needs to last longer moving forward in 2024. Next slide, please. So we are on slide 14. Here you have the breakdown of the net sales over Q1 and Q2 for the first half. As you understand, the PIVLAS has still been consolidated, the 32 million sales. because the transaction closed post 30th of June. But moving forward, the whole business in Japan and South Korea will be deconsolidated, i.e. the net sales and operating expenses and corresponding financial and tax expenses relating to the APAC-X China region will no longer be reported in the PML. They will be reported in a dedicated line on results from a discontinued operation and, of course, again on these discontinued operations. So moving forward, what you will see, starting with Q3, for the first half, are only the QVV cells of 11.7 million. Next slide, please. So here you see, and I will come back to the non-GAAP operating expenses, how the P&L came about. Net revenues of 51, 44 million cells, because here PBLAS is included, other contract revenue of $7 million. We see a non-GAAP OPEX of $3.93, leading to a non-GAAP operating loss of $3.42, with the usual depreciation and amortization, stock-based compensation. This leads to a U.S. GAAP operating loss of $3.75. And below EBIT, mainly a financial expense, you end up with a US GAAP net result of minus 405. Next slide, please. Not spending too much time on the OPEX, you see here how they compare to last year. As one could expect, research and development, we try to limit the OPEX, and we succeeded with 54 compared to 60 million in the preceding H1 2022, 99 with development, and an increase in SEM, mainly driven by the U.S., but also with the launch or launch preparation across EU5 with, for the first half, 235 million. Next slide, please. Here, just to give you a sense of what is the scope we operate and how it will be reflected moving forward. We have reported non-GAAP operating results of 342. If you exclude the 5 million positive impact of Japan and South Korea, it means that moving forward, H1 non-GAAP operating results are or will be 346 million. If you exclude the DNA and share bait compensation, it will be $377 million. Next slide. Cash flow. As you know, we started the year with $466 million. And if we want to reconcile with just non-GAAP operating results I showed previously, which includes Japan for 5 million, we've had significant working capital requirements, 70 million. You will see a proceed from borrowings will come later on 30 million. Other items which led to a liquidity of 33 million. Next slide, please. So coming to the liquidity and these 33 million, they include 10 million, which was the payment made by SOCEI in June at the signing of the non-binding term sheet, 10 million, and also a 20 million bridge loan funded by Jean-Paul Le Closel. So it's a bridge loan of 75 million, of which we had first a drawdown of 20 million by the end of June, and which has been actually repaid last Friday, when we got the additional payment from the closing of the Sofai-Hebtaris deal of 6.6 million. It is a $400 million deal, and there will be an adjustment normally within 90 days of closing, so around mid-October, where approximately we should get $4 million, plus or minus. What the liquidity does not include, what it excludes, is the cash flow. held in Japan, 11 million, because this is a reported separate item in our financial results, so-called assets held for sales relating to Japan and South Korea. So next slide. This is my last slide. want to reinforce the operating guidance, so $650 million non-GAAP, $735 million U.S. GAAP operating loss, but on the new scope of transaction, so excluding the impact of the social year deal. And as you have seen, actually, we have spent 346 million in H1. So to achieve this guidance, it implies that we will spend less, around 300 million, in the second half of 2023. And as we see, I will hand over to Andrew again.

Thank you, André. So we have come to the end of our prepared remarks and are ready now to take your questions. Thank you. Please play by the rule and ask only one question at a time and then jump back into the queue. Operator, could you please queue the lines?

thank you so as a reminder if you would like to ask a question please press star one and one on your telephone and wait for your name to be announced and to withdraw your question you can press star one and one again that's star one and one to ask your questions thank you we'll now go ahead with the first question please stand by First question is from the line of James Gordon from JP Morgan. Please go ahead.

Hello, James Gordon, JP Morgan. Lots of questions, but I'll keep to one and I'll get back in the queue. In terms of, there's a few different moving parts in terms of divestment, etc. But as I understand it, you would still only have funding to take you through to early next year. And there was a comment about initiatives to extend the runway. So is that more likely to be divesting pipeline assets, and are you already in any discussions with anyone about divesting assets in the pipeline, or is it more likely that you would raise equity? What's the most likely there, and where are you with discussions at other avenues, please? Thank you, James.

So on funding avenues, I think, Andre, you'd be best to address this.

Yeah, I assume so. Thank you, James, for the question. Let me just give you some backdrop on what happened in Q2. Yes, we were able to close this transaction with SOSE, but we were also ready to go for an equity raise just in case we would not be able to close the deal. So, moving forward, yes, we have some ongoing discussions. First, we see a prior review and ongoing discussion, meaning that we will look for some potential partners on some of the pipeline assets. And hopefully, we have a few balls in the air, and hopefully we'll be able to catch one or several. That's one. And as I told you, prospectus was ready, banks were appointed, lawyers were appointed. So if need be, we will put a trigger for an equity raise. I want to start, I was always with the same objective, of course, obviously not the case right now, and obviously not the case early in 2023, but I would like to start 2024 with cash covering the next 12 months of cash burn. The cost reduction initiative Again, it's important to the extent that any cash that we will raise, as I just said, will also need to last longer. So it will be a combination. It's not one deal in isolation. It's several potential deals in connection with equity or equity-linked deals. with the cost initiatives and portfolio review that hopefully will bring us there by the end of 2023. Thank you.

Thank you, André.

Thank you.

Operator, next question, please.

Thank you. Yes, we'll move to the next question. Please stand by. This is from Peter Verdelt from Citigroup. Please go ahead.

Thank you, people. Obviously, I'll keep to one as well. John, Paul, forgive the bluntness of the question, but as you said yourself in the opening remarks, the viability of the Adorsi business model is brought into question in the absence of QVVIC becoming a commercial success. So I suppose my simple question to you is, is there a point in time in, let's say, 2024 where you might consider alternative options for the group as a whole or the U.S. interest in QVVIC, whether you look for partners to bring on board. I just wanted to know if that is in your thinking at all at the moment. Thank you.

Thank you, Pete. So more strategy point of view. Jean-Paul, do you want to address that?

Yeah, exactly. No problem. Yes. I think that we have a fantastic drug with QVVIC. It's just a launch as happened one year ago, just a little bit more than a year in the U.S. We are basically, in terms of prescription, we are nearly as many prescriptions as Belsomra, new prescription at least, as Belsomra, which is seven years. We need to transform the demand into sales and into revenues. It just has taken longer than what we expected, but we need to make, and I think we are on the track, to make QVVC a success. It just is the timing. And the timing has, of course, the financial consequences that, as you have seen, that we have partially solved with SoSci. What you have to know, we have a 15-year patent life with this drug, which is exceptional. We need to grow this drug and to make it a success. Now we have to be realistic with the timing. And of course, with Andre, with the group, we have to adjust our expectation from the difficulties we are seeing on the market. But the feedback is excellent. And I think in Europe, people will be surprised because the problem in Europe, once we will get reimbursement in countries like France, in England, in Germany. It's going to be very different from the problem we are facing in the U.S. where the access has been an issue. So I think that we need and we will make QEVIC a success. Now we are also developing a prostitutant and we have many other assets And my question is really what, uh, for the other assets, and of course, what do we do with these other assets? And this is where more of the strategic question we rely. What do we keep? What do we partner? And, uh, but frankly, I think that, uh, as a six years old company, if a post-it 10, 10 is approved, uh, end of this year, as it should be. I do believe that very few companies within five years or six years, let's say, will have, and if we count Clasos and Tan, which has now been sold to Sosay, but within five years as registered sweet drugs, this would have been a fantastic success. So we need to really benefit from this effort and we need to find the financial solution to do it. But I think that you really, is an important asset and should remain an important asset for Eidosia.

Thank you.

I'll get back to you. Operator, next question, please.

Thank you. I'll now take the next question. Please stand by. This is from the line of Sash and Jane from Bank of America. Please go ahead.

Thanks for my questions. More on liquidity, if I may. That's for Andre. On the redundancy program, what's your best guess on what the cash severance charge would be? In typical programs, they're typically one times future savings, so it implies sort of low hundred millions and how that impacts the timing and size of any funding. So that's my first question. My second one, if I may, just to follow on from James's. How close to the end of the year will you run pipeline monetization options before progressing with equity? Thank you.

Thank you, Sachin. Sachin, you've been less disciplined than Peter. You asked two questions, but I will answer both. You know, we have an ongoing consultation with the employees representative in Switzerland. So that's ongoing. And the number of redundancies will also depend on this portfolio review that we are doing with Jean-Paul and his team. So I would not expect a significant impact regarding a headcount for the second half of 2023, but more a full effect starting 2024. So that's the first one. To your point, savings, yes, it's a fixed cost base. And we need to reduce the fixed cost base at headquarters, which is mainly in R&D, and also to a lesser extent in support functions, so G&A. But it's also the portfolio review and here either we find a partner and there are some discussions ongoing. I do not want to count my chickens before they hatch. So let's see what comes out of this discussion because the other way to reduce the cash burn to find a partner, not so much with the upfront, but also taking over some costs, notably for the asset in phase three. So mainly Sennarimod and Seratozal. To the funding options, yes, we mentioned our licensing deal. We mentioned equity raise or issuance of a new convertible, equity-linked. And the other one, you're right, could be royalty monetization type deals. We're exploring all avenues right now, and we need to implement some of them in the course of the second half.

Okay, thank you. Thank you, André. Thank you, Sachin. Operator, next question, please.

Thank you. We'll take the next question. Please stand by. This is from the line of Thibault Bouterin from Morgan Stanley. Please go ahead.

Hi, thank you for taking my question. Just could you have an update on the situation right now for Sarastat and what is the next step that will allow you to make an assessment on this one, please? Thank you, Thibault.

Jean-Paul, do you want to take that one on Lucerastat?

I think Lucerastat, we are just a minute. Okay. For Lucerastat, you know, we are in discussion with the FDA to find a solution because we have very interesting results and we are in discussion. It's not yet decided, so what we do And in Japan, as you have seen, I think that SOSE, and I cannot speak in their name, but we were in discussion with the Japanese authority for Japan. So I think that this is what is ongoing. And of course, if we do not find a solution for this erstat, we might partner it. I think there have been some people interested in lucerastat. This is a very active drug. Unfortunately, I think we didn't have a positive... The primary endpoint was not positive in our study. So we will see, but I'm convinced that lucerastat is a very good drug. But I can tell you we will not... spend ourselves. If we don't find a solution with the FDA, we are not going to spend more money, but rather maybe partners is growing.

Thank you. Thank you, Jean-Paul. Thank you, Thibault. Operator, next question, please.

Thank you. We'll now take the next question. Please stand by. And this is from Rajan Sharma from Goldman Sachs. Please go ahead.

Hi, thanks for taking my question. So just on the cost reduction at the minute, it feels like it's kind of focused on R&D and headquarters. But just thinking about the level of investment behind CubaVic, is there anything that you could do there? And I guess at what point would you think about kind of right-sizing the investment if you don't see the inflection in the revenue trajectory?

Andre, do you want to take that question on cost savings beyond the announcement of Friday?

Yeah, I'm volunteering, Andrew. It's a very good question. I just came two weeks ago. I was actually in the U.S. discussing with Patty and her team There are a lot of initiatives ongoing in the U.S. also to adapt the model converting free prescription into sales. But you're right. On one side, we need a few more quarters to cease the uptake because it's 12 months since the launch with limited coverage. And again, CVS will really kick in only in September with a Tier 2 IE at parity with Belsomra. No priors, no step edits. And of course, we submitted the edits for Medicare Part D. We should hear in the next few months from CMS and hopefully get Medicare Part D coverage, which is a significant chunk of the volumes of the insomnia market in the US in Q1 2024. So it's a question of time and money because it's a primary care drug. and time and money are two resources which are obviously very scarce at high doses right now. So we want to remain nimble and to be able to adapt to the situation. Not only in the US, it's the same in Europe. by making sure we have the right balance between how much we invest and what we can expect in terms of volumes, but volumes converting into a net sales.

Thank you, Andre. Operator, next question, please.

Thank you. We'll now take the next question. Please stand by. And this is from Brian Balshin from Jefferies. Please go ahead.

Hey, thanks. Just in terms of QVIVIC success, it looks like you've got better conversion from confinement to paid scripts. You said QVIVIC should be in Tier 2 early 4Q, but isn't it still the case that treatment-naive patients have to go through a benzo or Z drug prior to a DORA? And if so, do you see it as a block

Hello? Brian?

We lost Brian, Andrew.

Brian from Jefferies. Your line is open. We lost your line there. If you could please ask your question again. It looks like the line has disconnected. Should we move to the next one?

Yes, please. And then we'll take it later.

Thank you. Your next question is from the line of Harry Sefton from Credit Suisse. Please go ahead.

Brilliant. Thanks. So just back to the cost savings. To what extent do you think you can achieve part of the cost savings through out-licensing your late stage assets? So maybe to put another way, what percentage of your cost savings could you achieve from out-licensing Cineramod and Solatrid Grail? Thank you.

André, do you want to take that question on distribution of savings?

Yeah, happy to take your question. It's a premature hurry to figure out what we can do. By definition, getting a collaboration or partnership or complacency requires to see It requires two parties to get both. If you're looking at the non-GAAP OPEX in H1, we have $362 million if you exclude Japan. $185 million in commercial, and we will address it. 144 in R&D, of which two-thirds, roughly, is fixed cost base and one-third is study costs. And as a remainder, it's around 33 million H2 HNA. So, of course, we need to work on all levels, i.e., headcount, so fixed cost base, and hopefully get... get some good partners for some of the assets. But right now, it's premature to speculate of what can be the outcome. Also on the headcount, because it also depends on the ongoing consultation with the employees' representatives.

That's very helpful. Thank you.

Thank you, Audrey. Thank you, Harry. Operator, do we have any more questions?

We do. Please stand by for the next one. Next question from the line of Stefan Schneider from Vontabel. Please go ahead.

Yes, thank you for taking my questions. My question is why the scripts are not, there is no inflection point. For instance, as the CVS deal in spring or in January beginning of the year, It seems like it's a continuous linear increase, but no inflection point. Can you elaborate on why that is and what to expect from CBS?

Thank you, Stéphane. Patti, do you want to take the question on how you see the inflection points and how these additional insurers pull through and how does that generate in volumes?

So great. Thanks, Andrew. I think maybe first We had ESI in January, right, just to qualify. I think you said CVS. As you're aware, just removing the NDC blocks does not provide immediate access for patients to get a covered prescription. The payers deny access unless a patient fails one or, in some cases, two generics within a 180-day look-back period. But we are seeing within our book of business with ESI in particular, since they've come on board in January, the conversion of consignment to paid scripts. And we believe that will continue. Now, if you look forward to our current situation with CVS, as noted in July, the NDC blocks were removed. And then as Andre and Jean-Paul mentioned earlier, Later this quarter, early quarter four, we will be moving into a Tier 2 position consistent with the other branded competitors in the DORA class. It is an inflection point of paid scripts that we believe will continue, and our sales force is focused on pulling through these ESI and CBS wins.

Okay. Thank you. Thank you, Patty. Operator, next question, please.

Thank you. We'll take the next question. Please stand by. Next question is from the line of James Gordon from J.P. Morgan. Please go ahead.

Hello, James and J.P. Morgan. Thanks for taking the question. Just continuing the theme on QVIC. If I understood correctly, you've made some real progress with coverage, but you don't see a benefit immediately when that is projected to the product. Am I following correctly that really it's not the Q3 or Q4 we should expect to see a big inflection? It's really more like Q1 is where you see the inflection coming through?

Thank you, James. Your line was a bit breaking up there. I understood that your question is going in the direction of when do you think that the inflection point is to happen? Does it happen already with CVS? when it passes September and is at eye level with Belsomra. Patti, do you care to elaborate on that, please?

Sure. Thanks. Thanks, Andrew. First, aligned to our demand-driven strategy, as you have seen, QVIVC continues to grow quarter over quarter, with the latest quarter being 23% increase over the prior quarter. Market access has been a primary factor why physicians have said they will wait to write the product. With increased coverage now with CVS, we believe it will send a strong message to physicians increasing their willingness to write to Vivek, converting to paid scripts. And we believe this will translate into continued growth. As of today, we have 63% of all commercial lives covered, and we continue to engage with all payers, both in the commercial and Part D spaces. As was mentioned earlier, we anticipate Medicare Part D coverage in January 2024. We have begun to see a switch from consignment to retail with the opportunity to realize more insurance-paid scripts. and we believe this will accelerate as our access continues to improve. Our co-pay programs will also be aligned to our strategy to drive and shift away from the consignment model to retail. As I mentioned earlier, our sales organization is very focused on pulling through ESI and CVS wins, and we anticipate this to continue to drive quarter-over-quarter growth.

Thank you, Patty. Operator, next question, please.

Thank you. And just as a reminder, if you would like to ask a question, you can press star 1 and 1 on your keypad. Thank you. We'll now take the next question. This is from the line of Peter Verdelt from Citigroup. Please go ahead.

Yeah, thanks, Pete from Old City. Patti, sorry to labour the point. Just a repeat of James' question. I mean, when you put everything together, what's your best guess when you think we'll see this revenue inflection on QVVIC? And then maybe just another way of thinking about it, I think the run rate right now is about, what, 8 million a quarter. If the current scripts were under a successful retail model versus consignment model, what would the revenue uplift be if that was the case? Can you give us some ballpark theory on that? through underlying revenues that would be under that sort of scenario. Thank you.

Thank you, Pete. Patty, do you care to elaborate a bit more on what your expectations would be on volume? I don't think that we should go beyond in giving revenue guidance at this point in time.

Yeah, I think, thank you, Andrew, and Pete, for the question. I do believe we will continue to see our volume growth, again, with the NDC blocks coming off for CVS in July and then a Tier 2 position with CVS in September will help drive and be able to realize insurance-paid claims. And then another significant milestone we anticipate is the Medicare Part D in January. 2024 so I think you know I think those are inflection points we have various models of what that looks like but while that's happening we are winding down our consignment model our free drug model program and and copay program and offering so the combination of the the enhanced coverage for paid claims as well as the um the winding down of the consignment model will help accelerate we believe our quarter over quarter growth so thank you thank you thank you patty operator next question please thank you we'll take the next question please stand by and this is from sash and jane from bank of america please go ahead

Thanks very much. Just another one back on funding for Andre. Whenever we just go back to the pipeline monetization, it seems like Solatogrel or Serenamod sort of partnering the most advanced options. So, why don't you just give us a bit more color on that as to how long discussions have been ongoing, whether for each asset you have more than one party at the table, and between assets, do you have a higher confidence in one versus the other? What I'm just trying to get a sense of with those questions is, were those discussions ongoing pre- of the APAC business, whether they started post that, because public monetization has been a topic for quite a long time now. Thank you. Thank you, Sachin.

Audrey, do you want to offer any additional granularity?

Sachin, I'm afraid I will disappoint you with my answer. Contrary to what we did with the undisclosed party for the APAC business ex-China, Here, I don't want to speculate on the outcome of the ongoing discussions. We have a few balls in the air. We'll see if we manage to catch one, but we will announce it once we have a deal that will close. Yes, working hard. I am not speculating whether, you know, giving a probability of success because at the end, it's a binary. Either it's a 1 or it's a 0. Okay, fair enough. Thank you.

Thank you, André. Thank you, Sachin. Operator, next question, please.

Thank you. There are no further questions at this time, so I will hand back to Andrew now. Thank you.

Thank you, Sarah. Okay, so we're just about at the top of the hour, so very convenient. So thank you very much for your ongoing interest. This will conclude our webcast for today. Operator, you may close the line.