Managing Director and Equity Research Analyst specializing in biotechnology at JPMorgan Chase & Co.
Jessica Fye is a Managing Director and Equity Research Analyst specializing in biotechnology at JPMorgan Chase & Co., where she provides coverage of leading biotech companies such as Alnylam Pharmaceuticals, Halozyme Therapeutics, Vertex Pharmaceuticals, Incyte, and BioMarin Pharmaceutical. With a 56.78% success rate and an average return of 10.01%, her recommendations have earned her consistent recognition, including as one of the 'Rising Stars Of Equity Research.' Fye began her career at Bank of America and New Providence Asset Management before joining J.P. Morgan in 2014, advancing to Managing Director in April 2021. She holds a Business Economics degree from Brown University and is noted for her rigorous market analyses and strategic investment recommendations.
Jessica Fye asked about the percentage of CARVYKTI patients receiving outpatient administration and the revenue contribution split between earlier and later lines of therapy.
Alan Bash, President of CARVYKTI, stated that about 50% of patients are currently treated in an outpatient setting, with expectations for this to grow. He noted that 60% of scripts come from the second through fourth-line population, with the third line showing the most pronounced growth.
Jessica Fye from JPMorgan Chase & Co. asked for the case for CARVYKTI's successful penetration into the community setting, citing investor feedback that demand at key centers appears satisfied with no backlogs.
Alan Bash, President of CARVYKTI, explained that high demand exists in the community due to CARVYKTI's survival benefit. He outlined a three-pronged strategy: increasing education for community sites, connecting academic and community experts, and ensuring community physicians that referred patients will return for ongoing care. CEO Ying Huang added that upcoming long-term data at ASCO and the recent OS label addition in Europe will further drive community uptake.
Jessica Fye asked for color on the expected cadence of revenue growth throughout the upcoming year, considering the various new sources of manufacturing capacity coming online.
An Unknown Executive stated that growth over 2025 will not be linear. They anticipate modest growth in Q1 following a strong Q4, partly due to facility maintenance during the holidays. Meaningful step-ups in manufacturing from Raritan and the newly approved Novartis facility are expected to drive more significant growth in Q2 and Q3.
Jessica Fye asked about the drivers behind the evolving mix of inpatient versus outpatient use for CARVYKTI and what that proportion might look like in the next 12 months.
SVP of Commercial Development, Steven Gavel, explained that the shift to outpatient use is primarily driven by treatment sites needing to absorb the increased patient volume from the second-line launch. While large academic centers are leading the adoption, new sites take time to gain experience. He emphasized that CARVYKTI's delayed CRS onset profile is a key enabler of this outpatient strategy.
Jessica Fye at JPMorgan Chase & Co. inquired about the methodology and confidence behind updating the TTR franchise guidance, particularly given that the cardiomyopathy launch was only two quarters old.
Jeff Poulton, CFO, explained that the updated guidance primarily reflects predictions for Q4 2025, estimating total TTR Global revenue of $850 million to $900 million, representing $125 million to $175 million of quarter-on-quarter growth. He noted that the upper end of this range aligns with Q2 and Q3 performance, indicating improving forecasting ability with more data points and comfort with the range, with the midpoint being the most likely Q4 outcome.
Jessica Fye inquired about the methodology behind updating the TTR franchise guidance, especially given that the cardiomyopathy launch is only two quarters in.
Jeff Poulton, Chief Financial Officer, explained that the updated guidance reflects estimates for Q4, projecting total TTR Global revenue of $850 million-$900 million, representing $125 million-$175 million of quarter-on-quarter growth. He noted that the company's understanding and forecasting ability are improving with more data points from the launch.
Jessica Fye of JPMorgan Chase & Co. requested more detail on the assumptions underpinning the updated TTR franchise guidance, particularly the pace of new patient starts, and sought reassurance that the guidance was not overly aggressive.
CCO Tolga Tanguler described expectations for steady growth in both first-line and second-line patients. CEO Yvonne Greenstreet affirmed it is guidance they expect to achieve. CFO Jeff Poulton provided context, noting the guidance implies ~$1 billion in YoY TTR growth, with over $600 million from cardiomyopathy, a figure he expressed high confidence in given the Q2 performance.
Jessica Fye asked for details on the additional launch indicators that will be provided with Q2 results. She also inquired about Alnylam's goal for formulary inclusion at the 170 priority health systems by the next quarter and by year-end.
Chief Commercial Officer Tolga Tanguler stated that while the original goal was to complete formulary inclusion by year-end, they are well ahead of schedule. He noted the most encouraging sign is that a majority of these accounts are already initiating patients on therapy. For Q2, he said the key update will be revenue uptake and pull-through, supplemented with more color on patient and prescriber trends.
Jessica Fye asked what early prescription data for competitor acoramidis implies for TTR market dynamics and how to think about the evolution of AMVUTTRA's net price in the larger cardiomyopathy population.
Chief Commercial Officer Tolga Tanguler said the early competitor data is encouraging as it confirms the category is a growth story. He believes AMVUTTRA is well-positioned with its strong clinical profile and convenient dosing. CEO Yvonne Greenstreet reiterated that the market growth opportunity is what makes the category exciting.
Jessica Fye asked what Alnylam is watching for in the upcoming acoramidis label and if any potential label scenarios for the competitor could affect Alnylam's own launch expectations.
CEO Yvonne Greenstreet expressed confidence in Alnylam's own HELIOS-B data and regulatory strategy, regardless of the competitor's label. Chief Medical Officer Pushkal Garg added that they view acoramidis as a twice-daily stabilizer and believe AMVUTTRA's distinct mechanism of action will position it well for first-line use or for patients progressing on stabilizers.
Jessica Fye asked about the early field feedback regarding physicians' experience with BRINSUPRI, specifically patient outcomes and the reimbursement process.
Will Lewis, Chairman and CEO of Insmed, and Roger Adsett, Chief Operating Officer, reported positive sentiment and broad prescribing. They noted that early reimbursement has been straightforward but cautioned that it's still very early in the launch (six weeks of data), and dynamics may change as payer criteria are finalized and enforced.
Jessica Fye asked about early field feedback on the physician experience with Brensupri, specifically regarding patient outcomes and the reimbursement process.
Will Lewis, Chairman and CEO, noted overall positive sentiment and enthusiasm from physicians. Roger Adsett, Chief Operating Officer, added that broad prescribing reflects initial enthusiasm, with physicians in a 'trial phase' for more severe patients. He also mentioned that reimbursement has been straightforward initially, but criteria are still being finalized by payers, which may lead to some slowdowns as enforcement begins.
Jessica Fye revisited the first-in-class respiratory launch analogs Insmed previously provided and asked about the company's confidence in brensocatib achieving a similarly strong commercial ramp.
CEO William Lewis expressed a clear ambition for brensocatib's launch to 'fall within reach' of those successful analogs, though he did not provide formal guidance. He tempered expectations by noting the unpredictability of a first-in-disease launch. CFO Sara Bonstein added a practical reminder that revenue booking typically begins a few weeks after approval, citing the ARIKAYCE launch as precedent.
An associate for Jessica Fye asked about the upcoming TPIP data update, questioning the relative importance of Pulmonary Vascular Resistance (PVR) versus the 6-minute walk test and whether the Phase II trial was powered for the latter.
CEO William Lewis described PVR as the most definitive primary measure of the drug's direct impact, while the 6-minute walk test is a less specific, ancillary measure. He confirmed the Phase II study is not powered for statistical significance on the 6-minute walk test but the company hopes to see a directional benefit of 15-20 meters.
An analyst on behalf of Jessica Fye asked about the relative importance of PVR versus 6-minute walk distance in the upcoming TPIP data readout and whether the Phase II trial was powered for the walk test.
CEO William Lewis explained that PVR is the most definitive measure of the drug's direct impact, while the 6-minute walk test is a less specific ancillary measure of exercise capacity. He confirmed the study is not powered for statistical significance on the walk test but hopes to see a directional benefit of 15-20 meters. A placebo-adjusted PVR reduction of 20% would be considered a 'clear win.'
Jessica Fye asked for an estimate of U.S. bronchiectasis patients with two or more exacerbations and for the expected trajectory of SG&A and R&D spending in the coming year.
CEO Will Lewis estimated that about 50% of the 500,000 diagnosed U.S. bronchiectasis patients have two or more exacerbations annually, noting the addressable market could be larger. CFO Sara Bonstein stated that operating expenses are not expected to decrease due to continued investments in R&D and commercial launch preparations for brensocatib, though the SG&A-to-revenue ratio should improve post-launch.
Jessica Fye asked for details on the necessary steps before commencing the TPIP Phase III trial in PH-ILD, including manufacturing work, and inquired about the expected enrollment dynamics for the trial.
CEO Will Lewis explained the H2 2025 trial start is timed to complete manufacturing optimization, finalize trial preparations, and confirm the regulatory pathway with the FDA, with the expectation of needing only one Phase III study. The manufacturing goal is to deliver doses up to 640 micrograms in a single, convenient capsule. He added that the competitive trial landscape for patient enrollment is expected to be less dense by the time the study begins.
Jessica Fye from JPMorgan Chase & Co. asked for details on the necessary steps, including manufacturing work, required before commencing the TPIP Phase III trial in PH-ILD, and inquired about the expected enrollment dynamics for the trial, considering factors like the launch of Tyvaso.
CEO Will Lewis explained that the start of the TPIP Phase III trial in H2 2025 is contingent on three factors: trial preparation, dialogue with the FDA to confirm a single Phase III study pathway, and crucially, manufacturing optimization. This optimization aims to deliver doses up to 640 micrograms in a single capsule for patient convenience. He added that while enrolling such trials is challenging, the competitive landscape of other clinical trials is expected to be less dense by then, which could aid recruitment.
Jessica Fye asked about the anticipated launch curve for olzarsen in severe hypertriglyceridemia (sHTG), specifically inquiring if there's pent-up demand or a 'warehouse effect' similar to the FCS launch, and how to model the adoption ramp given the larger patient population.
Kyle Jenne, Chief Global Product Strategy Officer, Ionis, indicated strong interest from healthcare professionals (HCPs) in expanding TRYNGOLZA use and adopting olzarsen for sHTG. He noted that the company plans to expand its target HCPs from 3,000 to 20,000, covering approximately 360,000 sHTG patients, many of whom are not reaching treatment goals with current standard-of-care therapies. He expects strong uptake based on market interest and phase III data.
Jessica Fye asked about the anticipated launch curve for Olzarsen in severe hypertriglyceridemia (SHTG), inquiring whether there's pent-up demand for rapid adoption similar to the familial chylomicronemia syndrome (FCS) market, and how to best model the ramp-up.
Kyle Jenne, Chief Global Product Strategy Officer, explained that there is strong interest in Olzarsen for SHTG, with plans to expand target healthcare providers (HCPs) from 3,000 to 20,000, covering approximately 360,000 high-risk SHTG patients. He anticipates strong uptake, especially among patients on standard-of-care treatments who are not reaching their triglyceride goals.
Jessica Fye asked if the Q1 TRYNGOLZA sales number included channel stocking, requested clarification on the drivers of the increased revenue guidance, and inquired about the manufacturing footprint and tariff exposure for key products.
Chief Global Product Strategy Officer Kyle Jenne confirmed that Q1 TRYNGOLZA sales were driven by demand with minimal inventory stocking. CFO Beth Hougen specified that the vast majority of the revenue guidance increase was due to licensing deals for sapablursen and olezarsen. CEO Brett Monia detailed that manufacturing sources in the U.S., Europe, and South Korea provide a robust supply chain, and stated that tariffs have not had a meaningful impact on the business to date.
Jessica Fye from JPMorgan Chase & Co. asked about the market dynamics for WAINUA in TTR polyneuropathy, specifically what portion of new patient starts the drug is capturing.
Chief Global Product Strategy Officer Kyle Jenne stated that WAINUA is performing strongly, capturing approximately 40% of new-to-brand patient starts. He highlighted accelerating quarterly growth, broad prescriber adoption from both specialists and community physicians, and a patient mix that includes naive, switch, and combination therapy users, setting up a strong outlook for 2025.
Jessica Fye asked for clarification on the timing of the CARDIO-TTRansform data readout for WAINUA, noting it had shifted from H1 2026 to H2 2026, and questioned if the study's follow-up protocol had been changed to follow all patients for the full duration.
CEO Brett Monia explained that the timeline shift is due to a strategic decision with partner AstraZeneca to run the study to its full completion, with all patients followed for 140 weeks, to generate the most robust and comprehensive dataset possible. He confirmed this decision, rather than an earlier readout, accounts for the H2 2026 timing after data finalization.
Jessica Fye asked what elements of 989 data in post-Jakafi patients and suboptimal responders could instill confidence for frontline success, specifically for combo data, what proof points are needed for clear clinical benefit on top of Jakafi without a control arm, and what magnitude of change would exclude natural variability. She also asked how SVR25 data is incorporated into decision-making.
President Pablo Cagnoni emphasized looking at the totality of evidence for 989: its excellent safety profile, efficacy (classic clinical endpoints like spleen reduction, symptom improvement, anemia, plus translational endpoints in monotherapy). For the add-on cohort (hardest patients), any improvement on classic endpoints is highly meaningful given low benchmarks (9-20% SVR35). Combining monotherapy, add-on, and safety data increases confidence for frontline, with an update on treatment-naive patients in 2026 being definitive. Regarding SVR25, Pablo Cagnoni stated it is reported as done in other trials, but SVR35 is the key element and what they truly care about for decision-making.
Jessica Fye from JPMorgan Chase & Co. asked CEO Bill Meury how he plans to balance investments between the internal pipeline, external business development, and commercial support, and what his five-year vision is for the company.
CEO Bill Meury described his capital allocation philosophy as rigorously 'calling balls and strikes' between internal and external opportunities with no 'sacred cows.' His five-year vision is to set a 'new high watermark' for Incyte by executing on its growth portfolio, R&D priorities, cost management, and business development, with a special focus on dominating the MPN market.
Jessica Fye asked about Incyte's current perspective on capital allocation, business development strategy, and whether another Accelerated Share Repurchase (ASR) is being considered given the stock's valuation.
CEO Herve Hoppenot stated that capital allocation is primarily driven by the internal pipeline, with successful proof-of-concept data leading to R&D investment in Phase III trials. He mentioned that external business development focuses on early-stage partnerships but declined to comment on future share repurchase plans.
Jessica Fye from JPMorgan Chase & Co. asked about the povorcitinib program in hidradenitis suppurativa (HS), questioning whether Incyte would seek a label for biologic-naive patients and if the trials were powered for both naive and experienced subgroups. She also followed up on what 'close to Phase II' results meant, given the different efficacy deltas at 12 and 16 weeks.
Pablo Cagnoni, President, Head of R&D, responded that prior biologic exposure is a stratification factor and the data will be analyzed accordingly, with label discussions to follow with the FDA. He clarified that 'close to Phase II' refers to replicating the overall positive profile of efficacy and safety, emphasizing the importance of the rapid benefit seen at the 12-week primary endpoint, rather than a specific percentage.
Jessica Fye from JPMorgan Chase & Co. asked how Novartis's update on its BET inhibitor affects Incyte's strategy for its own BET inhibitor and requested clarity on the development plans and market positioning for povorcitinib and INCB00262 in chronic spontaneous urticaria (CSU).
Pablo Cagnoni, President and Head of R&D, stated that their BET inhibitor plans remain unchanged, emphasizing its potential for continuous dosing as a key differentiator. For CSU, he explained povorcitinib is in a Phase II proof-of-concept study, while INCB00262 is being studied across a full dose range. He positioned INCB00262 as a potential first therapy after antihistamines due to its targeted mechanism and expected clean safety profile, suggesting the two molecules could be sequenced in treatment.
Jessica Fye asked for the 2027 FactSet consensus excluding ROCTAVIAN, and whether the 40% non-GAAP operating margin target for 2026 and the greater than $1.25 billion CFO target for 2027 were still expected. She also inquired about the expected data for the 9-mg cohort of BMN-351 and the powering and minimum efficacy delta for the hypochondroplasia trial.
Brian Mueller (CFO, BioMarin Pharmaceutical) clarified the 2027 FactSet consensus without ROCTAVIAN is $3.65 billion. He confirmed the 40% non-GAAP operating margin target for 2026 remains on track, prioritizing value creation. He stated the $1.25 billion CFO target for 2027 was top-line dependent. Greg Friberg (Chief R&D Officer, BioMarin Pharmaceutical) explained BMN-351's update will include safety and biopsy data for 6mg and 9mg cohorts, aiming for 10% dystrophin at steady state. For hypochondroplasia, the study is powered for an AGV delta similar to VOXZOGO in achondroplasia.
Jessica Fye sought clarification on the 2027 FactSet consensus excluding Roctavian, the feasibility of the 40% non-GAAP operating margins target for 2026, and the greater than $1.25 billion CFOs target for 2027. She also asked for details on BMN-351's six-month biopsy data for the 6mg and 9mg cohorts and the powering and minimum efficacy delta for the hypochondroplasia trial.
Brian Mueller, Chief Financial Officer, clarified that the 2027 FactSet consensus without Roctavian is $3.65 billion. He reaffirmed the 40% non-GAAP operating margin target for 2026, noting it's on track due to efficiency efforts, but stated that the >$1.25 billion CFOs target for 2027 was top-line dependent and would be proportional to revenue scenarios. Greg Friberg, Chief R&D Officer, indicated that BMN-351's top-line results would include safety data from 6mg, 9mg, and early 12mg cohorts, plus biopsy results for 6mg and 9mg, aiming for 10% dystrophin at steady state. He confirmed the hypochondroplasia study is powered for an AGV delta similar to Voxzogo in achondroplasia, with confidence from Dr. Dauber data.
Jessica Fye of JPMorgan Chase & Co. asked how BioMarin plans to address market concerns about long-term competition for VOXZOGO and solidify the perception of its value beyond 2030.
Cristin Hubbard (CCO) and Greg Friberg (Chief R&D Officer) outlined a two-part strategy. Commercially, the focus is on a 'start-and-stay' paradigm driven by a growing body of real-world evidence, an infant label, and a broad global footprint. From an R&D perspective, they will continue to generate and publish data on health benefits beyond height and advance the next-generation asset, BMN 333, to secure the franchise's long-term value.
Jessica Fye inquired about BioMarin's business development priorities, specifically asking about the focus on pipeline versus commercial assets and the company's appetite for clinical risk. She also asked about any notable Q1 ordering patterns for the enzyme business.
CEO Alexander Hardy stated that business development is a key priority, with the company evaluating a range of preclinical and clinical assets that leverage its global commercialization strengths. CFO Brian Mueller addressed the second question, stating there were no specific Q1 ordering patterns to highlight but reiterated that overall 2025 revenue growth is expected to be weighted to the second half of the year.
Jessica Fye questioned the elevated Cost of Goods Sold (COGS) in the quarter, asking about the specific impact from Roctavian inventory reserves. She also followed up on the BMN 333 timeline, inquiring if multiple ascending dose data could be available in 2025.
EVP, Chief Financial Officer Brian Mueller explained that the lower gross margin was driven by two factors: a higher mix of lower-margin Aldurazyme revenue and inventory reserves for gene therapy raw materials due to the pause in Roctavian manufacturing. EVP, Worldwide R&D Greg Freiberg confirmed that only single ascending dose PK data for BMN 333 is committed for 2025.
Jessica Fye of JPMorgan Chase & Co. inquired about how Stoke will communicate enrollment updates for the Phase 3 Dravet trial and asked about the potential for delivering data earlier than the guided 2027 timeframe, given the high number of pre-screened patients.
Interim CEO Ian Smith explained that the current rate-limiting factor is the activation of clinical trial sites, not patient demand. He committed to communicating any changes to the existing timelines (enrollment completion in 2026, data in 2027) as soon as they become evident. He also reiterated the company's strategy of providing regular data updates at medical conferences and on earnings calls.
Jessica Fye from JPMorgan Chase & Co. questioned Nektar's comfort level with the statistical power of the maintenance phase of the AD trial following dropouts, and asked for the rationale behind using OX40 inhibitors as the primary benchmark for Respag.
Chief Research & Development Officer Jonathan Zalevsky affirmed that the 190 patients who entered the maintenance phase was consistent with their statistical modeling, and they feel confident in the study's powering. He explained that OX40 inhibitors are an appropriate benchmark because their Phase IIb trials were more contemporary and similar to Nektar's in terms of statistical rigor, patient populations, and the novelty of the mechanism, making it a more relevant comparison than older trials for drugs like Dupixent.
Jessica Fye of JPMorgan Chase & Co. asked about Nektar's regulatory strategy, questioning whether the company would wait for the 36-week maintenance data from the atopic dermatitis study before engaging with the FDA or move forward sooner based on the 16-week induction data.
Executive Jonathan Zalevsky confirmed the company plans to act sooner. He stated that they do not need to wait for the maintenance data and intend to use the upcoming 16-week induction results to request an end-of-Phase II meeting with the FDA, aiming to maintain program momentum and move into Phase III as quickly as possible.
Jessica Fye from JPMorgan Chase & Co. asked if the reduction in serum protein expression in atopic dermatitis patients was sustained after REZPEG therapy stopped, and questioned the reason for the alopecia data timeline shifting to the second half of 2025.
Chief R&D Officer Dr. Jonathan Zalevsky clarified that proteomic data from the Phase Ib study was not collected after treatment ended, but the current Phase II study will capture this. Chief Medical Officer Dr. Mary Tagliaferri explained the alopecia trial started later and has a longer treatment period, making the second-half 2025 timeline consistent with projections, also noting that European site activation is slower.
Jessica Fye from JPMorgan Chase & Co. asked for clarification on Yorvipath's enrollment trends, questioning if the Q2 increase of approximately 1,350 unique patients represents a continuing rate.
President & CEO Jan Møller Mikkelsen clarified that after adjusting for about 200 patients from an early access program in Q1, the underlying new patient growth was steady from Q1 to Q2. He noted an acceleration in the conversion of prescriptions to treated patients is expected in the second half of the year. Jay Donovan Wu, EVP & President - US Market, added that it is still early in the launch and the company is focused on optimizing the entire patient funnel.
Jessica Fye inquired about the execution and long-term expectations for YORVIPATH reimbursement, asking what proportion of patients with a prescription are expected to ultimately receive coverage and whether Q1 revenue included any initial channel fill.
Chief Financial Officer Scott Smith confirmed that channel inventory for YORVIPATH is minimal, averaging one to two weeks. President and CEO Jan Mikkelsen provided a personal estimate that 17% to 18% of patients would ultimately be reimbursed. EVP and President, Ascendis U.S. Jay Wu added that favorable payer policies are being established for both commercial and government plans, and approvals are occurring even without formal policies through medical exceptions, underscoring the drug's strong clinical value proposition.
Jessica Fye inquired about the reimbursement rate for Yorvipath at steady state and if Q1 revenue included initial channel fill.
CEO Jan Mikkelsen estimated a potential 70-80% reimbursement rate. CFO Scott Smith clarified channel inventory averaged one to two weeks.
Jessica Fye inquired about Ascendis's confidence in retaining YORVIPATH patients amid potential competition and whether the company still expects to achieve operating cash flow breakeven by the end of 2025.
Jan Mikkelsen, President and CEO, expressed high confidence in YORVIPATH's durability, citing its unique profile as a 'true replacement therapy' that competitors are unlikely to match. Scott Smith, EVP and CFO, confirmed that achieving cash flow breakeven by the end of 2025 remains the company's goal and is achievable with current capital.
Jessica Fye inquired about the strategy to elevate SKYTROFA to blockbuster status in the U.S., considering the recent net price reset and current market penetration.
President and CEO Jan Mikkelsen explained that the path to blockbuster status relies on SKYTROFA's premium net value per patient (approximately 3x daily therapies), its position as a preferred brand, and significant label expansion opportunities. He noted the total U.S. growth hormone market is about $1.4 billion, and upcoming filings for Adult Growth Hormone Deficiency and data for Turner Syndrome will unlock access to a much larger portion of this market.
Jessica Fye of JPMorgan Chase & Co. inquired about Emergent's NARCAN business, asking for details on recent strategic pricing actions, whether the projected low-to-mid single-digit market growth is based on volume or revenue, and the company's ability to maintain market share. She also asked for a housekeeping clarification on whether the Q2 SG&A expense is a good run rate for the remainder of 2025.
President and CEO Joseph Papa addressed the NARCAN questions, stating that pricing has been relatively stable over the last several months and that the growth projection refers to market volume. He expressed confidence in maintaining market leadership through competitive pricing, new programs like NARCAN Direct, and product line extensions. EVP and CFO Richard Lindahl confirmed that the Q2 SG&A figure is a decent run rate for the rest of the year, with a potential variance of plus or minus 5%.
Jessica Fye asked about Emergent's exposure to tariffs given its manufacturing footprint, the drivers behind the significant gross margin improvement in Q1, whether recent NARCAN market dynamics were contemplated in Q1 guidance, and the rationale for revising the naloxone market growth forecast down to mid-single digits.
CEO Joseph Papa explained that the company has limited tariff exposure as most products are manufactured in the U.S. or Canada and are USMCA compliant. CFO Rich Lindahl attributed the strong gross margin to significant cost reductions from divesting sites like Camden and Bayview, which reduced unutilized capacity, and a favorable product mix with high-margin international orders. Mr. Papa confirmed they had anticipated some NARCAN dynamics but gained more clarity on the magnitude during the quarter. He also clarified that the company has consistently viewed the naloxone market as having mid-single-digit growth potential, with the business-to-business segment expected to be a key growth driver.
Speaking on behalf of Jessica Fye from JPMorgan Chase & Co., an analyst asked for the drivers behind the lowered NARCAN guidance, the latest revenue mix for NARCAN across its various channels, competitive dynamics in the public interest market, and the expected timing for the remaining smallpox contract revenue.
President and CEO Joe Papa explained the NARCAN guidance adjustment reflects a balance between strong volume growth (up 7% year-to-date) and competitive pricing actions, though he noted pricing has been relatively stable since July 2024. He stated the public interest channel constitutes about 70% of the NARCAN business. EVP and CFO Rich Lindahl clarified that most of the remaining smallpox contract revenue is expected in 2025, with a portion in Q4 2024, all of which is factored into the updated guidance.
An analyst on behalf of Jessica Fye from JPMorgan Chase & Co. asked for details on the expected revenue distribution between LIVMARLI and the bile acid business for the remainder of the year.
Co-Founder & CEO Chris Peetz declined to provide a specific product-level breakdown of the updated full-year guidance. However, he indicated that the revenue trends observed year-to-date are expected to generally continue through the second half of the year.
Jessica Fye inquired how Mirum's interim Phase II PBC data for volixibat compares to competitor data for linerixibat and asked for commentary on the observed placebo response. She also asked about the remaining steps required before initiating the Phase II study for MRM-3379 in Fragile X syndrome.
CEO Christopher Peetz highlighted the strength of volixibat's placebo-adjusted difference, which he attributed to using a maximally efficacious dose. Regarding the MRM-3379 program, Peetz stated the company is preparing the IND and engaging with the FDA, with a more detailed update on study design to be provided later in the year.
Jessica Fye asked about the underlying assumptions for the $1 billion revenue potential of MRM-3379 in Fragile X and whether the drug's mechanism could be applied to other indications.
CEO Chris Peetz explained the market potential is based on the 50,000 male patient population in the U.S., making the $1 billion target readily achievable. CMO Joanne Quan added that the PDE4D mechanism is relevant for other conditions involving learning and memory, with Fragile X serving as the initial proof-of-concept before exploring other intellectual disability indications.
Jessica Fye posed several questions regarding volixibat data at the upcoming AASLD meeting, whether LIVMARLI experienced seasonal headwinds similar to the prior year, and how the recent in-licensing of a neurology asset impacts the company's evolution and future business development strategy.
CEO Christopher Peetz deferred detailed comment on volixibat data until its release but noted the top-line results are strong. On business development, he positioned the MRM-3379 deal as part of a long-term strategy to find overlooked value in rare genetic diseases. President and COO Peter Radovich confirmed that unlike 2023, no significant seasonal slowdown was observed for LIVMARLI in Q3 2024, with growth driven by Alagille syndrome and a strong PFIC launch.
Jessica Fye of JPMorgan Chase & Co. posed several modeling questions regarding gross margin trends, gross-to-net expectations for the rest of 2025, and a potential ramp-up in R&D spending. She also asked for the company's case on how NEXLETOL will remain competitive with additional oral non-statin therapies coming to market.
CFO Ben Halladay clarified that significant gross margin benefits from the tech transfer will materialize early next year, gross-to-net has stabilized for 2025, and R&D will see only a minor, not significant, increase in the second half. President & CEO Sheldon Koenig addressed the competitive threat by highlighting a strong IP position with settlements to 2040 and NEXLETOL's unique, established indications in primary prevention and statin-intolerant patients, areas where future competitors are not conducting outcome studies.
Asked about the timing and differentiation of the new triple combination products, as well as their development timelines and potential exclusivity period.
The triple combo is a complementary part of their blockbuster strategy. It differentiates not just on LDL lowering but also by reducing hsCRP and having no effect on glucose. Development timelines will be detailed in the fall, and it's too early to comment on the exact patent life extension.
Jessica Fye of JPMorgan Chase & Co. inquired about the increased commercial spending for Gernavix, asking if it was pre-planned or a reaction to launch dynamics, and about the enrollment timeline for the two suzetrigene Phase 3 trials in DPN.
President and CEO Dr. Reshma Kewalramani noted that the first DPN trial for suzetrigene may complete enrollment ahead of the second. EVP and CCO Duncan McKechnie explained the augmented Gernavix investment is a reaction to strong progress in payer coverage, positive clinical feedback, and high promotional responsiveness.
Jessica Fye inquired about the potential impact of tariffs on Vertex's manufacturing footprint for ALYFTREK, TRIKAFTA, and JOURNAVX. She also asked for clarification on the financial impact from the Russia issue on the CF business and whether it was contained to Q1.
CFO Charlie Wagner clarified that the impact from the Russia issue was approximately $100 million in Q1 and is expected to be $200 million for the full year, which is fully factored into guidance. Regarding tariffs, he stated the impact is currently immaterial due to a well-balanced global supply chain with minimal China exposure and drug product manufacturing for CF primarily in the U.S. He noted this could change if sector-specific tariffs are implemented.
Jessica Fye questioned the drivers of the 2025 revenue guidance, specifically asking for the breakdown of growth between the U.S. and ex-U.S. CF business, and requested quantification of nonrecurring items that benefited Q4 2024 revenue.
CFO Charlie Wagner explained that overall growth is driven by the CF portfolio, with the U.S. benefiting from the ALYFTREK and JOURNAVX launches. He noted ex-U.S. growth is impacted by an IP issue in one country. He did not quantify the Q4 nonrecurring items but cited favorable gross-to-net in the U.S. and one-time VAT rebates internationally as contributors.
Jessica Fye of JPMorgan Chase & Co. asked about the clinical development path for povetacicept, specifically questioning the steps needed to secure an at-home dosing approval given the Phase III RAINIER trial's requirement for post-dose monitoring.
CEO and President Dr. Reshma Kewalramani confirmed that Vertex is planning for and has had regulatory interactions to ensure povetacicept will be available for at-home, monthly, small-volume subcutaneous administration upon commercial approval, despite the current trial protocol.
An analyst from JPMorgan Chase & Co. inquired about the drivers of Orlodeyo's 45% year-over-year revenue growth, asking for a breakdown between volume and net price, and sought details on the improved patient discontinuation rate.
President & CCO Charlie Gayer explained that the Q2 revenue growth was a balanced mix of increased patient volume, gross-to-net improvements, and higher efficiency in paid shipments. He emphasized that the strong underlying patient demand is the key long-term growth driver. Gayer also clarified that while the one-year discontinuation rate remains stable at 60%, the overall rate is improving as tenured patients, who tend to stay on therapy long-term, now constitute a larger portion of the patient base.
Jessica Fye requested a quantification of the factors behind the ORLADEYO guidance increase, specifically the contribution from the Medicare Part D redesign versus demand and execution. She also asked how the accelerated profitability timeline impacts the company's strategy for investing in the business and its pipeline.
Chief Commercial Officer Charlie Gayer explained that approximately two-thirds of the paid-rate improvement was due to the IRA's impact on Medicare, with the remaining one-third from strong execution in the commercial insurance segment. He noted this was the primary factor for the guidance raise, supported by strong underlying patient growth. CEO Jon Stonehouse stated that pipeline programs are already fully funded and that the increased financial strength enabled a $75 million debt paydown to strengthen the balance sheet and reduce future interest payments.
Jessica Fye asked for an update on the proportion of paid patients for ORLADEYO, particularly within Medicare, and how this is reflected in the updated guidance. She also asked about the expected timeline for observing skin healing in the Netherton syndrome trial.
Chief Commercial Officer Charlie Gayer reported that the overall paid patient rate was 73.5% at the end of 2024 and that a rebound in Medicare paid patients could push this toward 80%. CEO Jon Stonehouse confirmed the pace of Medicare improvement is faster than anticipated, driving the guidance raise. Regarding Netherton, Chief R&D Officer Dr. Helen Thackray explained that skin healing could potentially be observed within a few months, possibly at 4-to-12-week assessments, after on-target drug activity is confirmed.
Jessica Fye's associate asked about the primary drivers for ORLADEYO's patient growth in the near and long term, and for more details on BioCryst's capital allocation strategy as its pipeline programs enter the clinic.
Chief Commercial Officer Charlie Gayer explained that ORLADEYO's growth is currently an even split between patients switching from other prophylactics and those moving from acute-only treatment, with switches expected to drive more growth long-term. CFO Anthony Doyle stated that revenue growth will significantly outpace operating expense growth, allowing the company to fund ORLADEYO's expansion and advance its Netherton syndrome and DME trials while moving toward sustained profitability by 2026.
Jessica Fye asked for details on upcoming BNT327 Phase 2 readouts, clarification on a potential timeline slip for the HER2+ endometrial cancer filing, and an update on the timing for the INEST adjuvant colon cancer trial data.
CSO Ryan Richardson confirmed the INEST adjuvant CRC data timeline remains late 2025/early 2026. CMO Özlem Türeci outlined the benchmarks for the BNT327 trials and clarified that the BNT323 endometrial cancer data would be shared in early 2026 to allow for data maturation, aligning with the planned BLA submission.
Jessica Fye asked about the potential impact of future U.S. biopharma tariffs and for a summary of the key differentiators of the BNT327 development program compared to competitors.
CFO Jens Holstein and CSO Ryan Richardson stated that the near-term financial impact from current tariffs is limited, though they are monitoring future policy changes. For differentiation, Richardson highlighted a two-pronged strategy for BNT327: first, aiming to be first-to-market in indications like TNBC and SCLC with chemotherapy, and second, a longer-term plan to create novel combinations with their proprietary ADC pipeline.
Jessica Fye of JPMorgan asked for specifics on the next data releases for BNT327, including timing and content, following the upcoming small cell lung cancer presentation.
CMO Özlem Türeci detailed the upcoming data pipeline for BNT327. The next major release will be for triple-negative breast cancer (TNBC), featuring maturing overall survival data. Additionally, she noted the potential for data from other cohorts, including the first results from the combination study of BNT327 with the company's TROP2 ADC, BNT325.
Jessica Fye asked why BioNTech guided to the low end of its revenue range while its partner Pfizer maintained its guidance. She also inquired about the fastest-to-market indications for BNT327 and the expected impact on R&D spending.
CFO Jens Holstein explained the guidance adjustment was due to lower-than-expected demand and pricing in low and middle-income countries within Pfizer's territory. Chief Strategy Officer Ryan Richardson identified small cell lung cancer as a potential fast-to-market indication for BNT327, with a Phase III portion of a trial expected to start by early next year.
Jessica Fye of JPMorgan Chase & Co. questioned how to interpret the read-across from the INCREASE study's IPF subgroup, who had pulmonary hypertension, to the broader TETON IPF population. She also asked about the circumstances for deploying the new share repurchase authorization.
Dr. Leigh Peterson, VP of Product Development, clarified that treprostinil has multiple anti-fibrotic mechanisms beyond vasodilation, suggesting efficacy in IPF regardless of PH status. James Edgemond, CFO & Treasurer, added that the board authorized the $1 billion buyback due to business strength, a robust balance sheet, and confidence in upcoming catalysts, stating it would be implemented 'expeditiously'.
Jessica Fye from JPMorgan Chase & Co. inquired about the year-over-year sales contribution to Tyvaso from the Medicare Part D redesign and whether that benefit is continuing in 2025.
Michael Benkowitz, President and COO, stated that while there was a clear year-over-year benefit from Q1 2024, the impact in Q1 2025 versus Q4 2024 is modest. He explained this is because any benefit from the lower out-of-pocket cap is largely offset by the new manufacturer obligation to contribute to catastrophic coverage, making the net effect minimal for the quarter.
Jessica Fye asked about the UKidney clinical trial, seeking details on the criteria for advancing between transplants and the proof points required to justify larger investments in DPF facilities.
Dr. Leigh Peterson, EVP of Product Development and Xenotransplantation, explained that after a cohort of six participants, a 12-week review by a DSMB will assess safety, patient survival, and graft survival to determine the risk-benefit for continuing. Chairperson and CEO Dr. Martine Rothblatt added that it is premature to speculate on further DPF facility investments.
Jessica Fye requested elaboration on the pre-IND feedback received from the FDA for the 10-gene edit kidney (U-kidney) and asked about the potential design and goals for the initial clinical trial.
Dr. Leigh Peterson, an executive in charge of Xenotransplantation, confirmed receipt of pre-IND feedback from the FDA. However, she stated that the company would not share details of the proposed clinical study design until after the IND is officially cleared by the agency.
Jessica Fye from JPMorgan Chase & Co. asked for expectations on U.S. volume and net pricing for the second half of the year, clarification on the types of strategic opportunities being evaluated, and a more detailed timeline for realizing the announced $70 million in cost savings.
CEO Aaron Berg confirmed that a major payer reinstated Vascepa to an exclusive position, supporting volume expectations for the second half of 2025. CFO Peter Fishman added that U.S. net price should remain comparable to Q2, and the $70 million in cost savings will be realized on a roughly straight-line basis over the next four quarters. Regarding strategic opportunities, Berg stated that while the company is evaluating all options from a position of strength, no further details would be provided at this time.
Jessica Fye inquired about the factors that contributed to the higher-than-expected U.S. net price for VASCEPA in Q4 2024 and sought guidance on how to model U.S. net price in upcoming quarters.
President and CEO Aaron Berg and CFO Peter Fishman explained that the higher Q4 net price was due to a favorable shift in business mix. This shift resulted from the volume impact of CVS Commercial moving VASCEPA to a 'not covered' status, which reduced the proportion of sales in higher-rebate channels. Fishman noted that the volume impact from this change would continue to affect year-over-year comparisons through the first half of 2025, alongside ongoing pricing pressure from exclusive contracts.
Jessica Fye from JPMorgan Chase & Co. asked for details on the revenue momentum in the 'rest of world' segment, the growth dynamics in the EU, and the future trajectory for VASCEPA's net price in the U.S.
President and CEO Aaron Berg attributed 'rest of world' momentum to nine partnerships beginning to contribute, highlighting recent launches in Australia and regulatory approval in China. He noted EU growth is driven by a strategy shift in the U.K. and strong execution in Spain. VP and Global Controller Peter Fishman added that U.S. net price pressure is expected to continue, influenced by the generic environment and a mix shift toward higher-discount Medicare Part D following the CVS formulary change.
Jessica Fye of JPMorgan Chase & Co. asked for the rationale behind the METIS PMA submission timeline potentially being later than PANOVA-3's, despite having the METIS data longer. She also requested clarification on how to calculate the revenue from prior period claims.
CEO Ashley Cordova explained the METIS submission is modular, a first for their torso device, requiring FDA review of initial modules before the final clinical module can be submitted, which dictates the timeline. Regarding prior period revenue, she clarified that the 3-5% range is a standard, recurring element already baked into the run rate since the adoption of the accounting standard.
Jessica Fye asked for clarification on the financial impact of tariffs, sought an early read on patient therapy duration for the NSCLC launch, and inquired about the enrollment status and completion timelines for the LUNAR-2 and LUNAR-4 trials.
CFO Christoph Brackmann clarified the tariff impact relates to different rates on arrays imported from Israel. Executive Frank Leonard noted that while it is still early, NSCLC therapy duration appears to be in line with expectations from the LUNAR trial. CEO Ashley Cordova stated that the LUNAR-2 and LUNAR-4 trials are in early enrollment, and it is too soon to provide completion guidance.
Jessica Fye of JPMorgan Chase & Co. inquired about the potential regulatory filing timeline for the PANOVA-3 pancreatic cancer indication, assuming a successful data readout. She also asked for quantification of the expected gross margin headwind from the launch of next-generation arrays.
CFO Ashley Cordova advised using industry norms for the PANOVA-3 timeline, estimating one to two quarters to prepare the submission post-data, followed by a standard review period. Regarding gross margin, she projected it would remain in the 70% range, with the exact figure depending on the net revenue generated from the lung cancer launch. She noted the cost headwinds from new arrays would be temporary, with margins expected to return to current target levels within six to eight quarters.
Jessica Fye asked if the CALM-CAH Phase III study design has been fully agreed upon with the FDA, what indication statement Crinetics hopes to achieve, and whether one or two trials will be required for approval in CAH.
Dr. Dana Pizzuti, Chief Medical and Development Officer, confirmed the protocol was developed based on input from the FDA and other health authorities, who are aware of the final design. She elaborated that Crinetics aims for an indication positioning atumelnant as the primary treatment for CAH, allowing glucocorticoids to be used solely for physiologic replacement, which would differentiate it from existing therapies.
Jessica Fye asked for an update on the open-label extension (OLE) for the CAH Phase II trial and whether data could be released before the Phase III results.
CEO R. Struthers confirmed that sites for the OLE are activating and patients are enrolling. He noted that all patients had come off the drug and are now re-initiating treatment. While he stated the data will be a valuable source of information, he did not commit to a specific timeline for its release.
Jessica Fye asked for the expected timing of Phase I data from any of the new candidates entering the clinic next year and questioned the selection of the MMAE toxin for CRN09682 and the ligand's similarity to paltusotine.
CEO R. Struthers declined to provide precise timelines for Phase I data but anticipated a steady flow of information. He clarified that the ligand in CRN09682 is a distinct SST2 agonist optimized for internalization, unlike paltusotine. MMAE was chosen as a well-established cytotoxic payload, and the company is exploring alternatives for future compounds.
Jessica Fye asked for details on the upcoming CDK4 program data disclosure at the R&D Day, questioning whether it would include efficacy and durability data. She also inquired about the enrollment status of the CDK4/6 naive cohort and if any data from that cohort would be presented.
Lai Wang, Global Head of R&D, confirmed that the R&D Day presentation will include safety, PK, and efficacy data from dose escalation cohorts, but durability data will be limited due to the rapid pace of enrollment. He stated that the CDK4/6 naive cohort is enrolling, but it is too early to disclose data from that group.
Jessica Fye focused on the CDK4 program, asking if efficacy data would be presented at the upcoming R&D Day and whether it would include durability metrics. She also inquired about the enrollment status of the CDK4/6 naive cohort and if any data from that cohort would be shared.
Lai Wang, Global Head of R&D, confirmed that data from the CDK4 dose escalation cohorts, including safety and efficacy, will be shared at the R&D Day, but durability data will be limited due to rapid enrollment. He noted that the CDK4/6 naive cohort is enrolling, but it is too early to disclose data from that group.
Jessica Fye sought clarification on the upcoming CDK4 program data, asking if efficacy results would be presented at the R&D Day and whether there would be sufficient follow-up to assess durability. She also inquired about the enrollment status of the CDK4/6 naive cohort.
Wang Lai, Global Head of R&D, confirmed that data from the dose escalation cohorts, including efficacy, safety, and PK, will be shared at the R&D Day. However, he cautioned that due to rapid enrollment of over 100 patients in the last two months, durability data will be limited. He also stated that the CDK4/6 naive cohort has begun enrolling patients, but it is too early to disclose that data.
Questioned the company's perspective on the upcoming pirtobrutinib (VERTO) readouts in frontline CLL, what they will be watching for, and the near-term competitive dynamics.
The company does not believe the upcoming pirtobrutinib trials will be practice-changing in frontline CLL, as they are against a non-standard-of-care comparator (chemo) or have a non-practice-changing endpoint (ORR). They view pirtobrutinib as positioned for post-covalent BTKi use and are confident in their own BTK degrader, which is advancing to a head-to-head trial against pirtobrutinib.
Jessica Fye from JPMorgan Chase & Co. questioned the company's perspective on upcoming pirtobrutinib readouts in frontline CLL and how investors should approach cross-trial comparisons with BRUKINSA.
Global Head of R&D Lai Wang downplayed the immediate competitive threat, arguing the trial designs use non-standard comparators (chemoimmunotherapy, ibrutinib) and endpoints (ORR) that are unlikely to be practice-changing. She highlighted BeiGene's confidence in its own BTK degrader, which is planned for a head-to-head trial against pirtobrutinib.
Jessica Fye asked for BeiGene's perspective on the upcoming pirtobrutinib (VERTO) readouts in frontline CLL and how investors should approach cross-trial comparisons against BRUKINSA.
Lai Wang, Global Head of R&D, downplayed the potential impact, arguing the trial comparators are not current standards of care and the study designs are not practice-changing. He positioned pirtobrutinib for post-covalent BTK inhibitor use and highlighted BeiGene's own BTK degrader as a potentially superior option, which is why the company is initiating a head-to-head trial.
Jessica Fye from JPMorgan Chase & Co. asked about BeiGene's expectations for the upcoming pirtobrutinib (Pirto) readouts in frontline CLL and what would constitute appropriate cross-trial comparisons against BRUKINSA.
Global Head of R&D Lai Wang downplayed the significance of the Pirto trials, noting one is against an outdated standard of care (chemo) and the other is in a mixed population with a non-practice-changing endpoint. She positioned BeiGene's own BTK degrader as a superior asset, highlighting the planned head-to-head trial against Pirto in a later-line setting.
An associate on behalf of Jessica Fye from JPMorgan Chase & Co. asked about the potential implications of the recent ENHERTU frontline breast cancer data on future sales and royalties for Roche's Phesgo.
Dr. Helen Torley, President and CEO, expressed confidence that Phesgo will continue its strong market adoption. She highlighted its convenient administration, high patient satisfaction, and upcoming long-term data. She noted that Phesgo's conversion share reached 47% and is expected to exceed 50% in 2025, stating that patients who switch to the subcutaneous version tend to remain on it, supporting projections for continued strong growth.
Jessica Fye asked when the partner and product for the new small volume auto-injector deal might be disclosed and requested the specific percentage range that Halozyme defines as 'mid-single digits' for royalties.
President and CEO Dr. Helen Torley stated that the partner wishes to remain confidential and could not provide a timeline for disclosure. CFO Nicole LaBrosse clarified that Halozyme defines 'mid-single digits' as a royalty rate range of 3% to 7%.
Jessica Fye from JPMorgan Chase & Co. followed up on the tariff discussion, asking for details on Jazz's broader manufacturing footprint beyond oxybate, including API sources and other potential mitigation strategies.
Renée Galá, President and COO, detailed the global manufacturing sites, including the U.K. for Epidiolex and various European locations for oncology products. Phil Johnson, CFO, added that the company holds sufficient U.S. inventory to cover nearly all of its 2025 needs for every product, providing a significant buffer against potential tariffs, and is exploring further options with U.S.-based contract manufacturers.
Jessica Fye from JPMorgan Chase & Co. asked for confirmation that the HERIZON-GEA trial's imminent enrollment completion refers to the upsized 918-patient target and questioned whether the slower-than-projected event rate is a positive or negative indicator for the trial's success.
Robert Iannone, EVP and Global Head of R&D, confirmed that enrollment completion refers to the 918-patient target. He explained that while the company remains blinded, a slower event accrual could be a positive sign if the experimental arms are outperforming, but this cannot be confirmed. He added that the control arm has been consistent in three prior Phase III trials, suggesting it is likely behaving as expected.
Jessica Fye of JPMorgan Chase & Co. sought confirmation on the HERIZON-GEA trial's upsized enrollment target and asked for interpretation of the slower-than-projected event rate.
EVP, Global Head of R&D Rob Iannone confirmed the upcoming enrollment completion refers to the upsized 918-patient target. He explained that while the company is blinded, a slower event rate could be a positive sign if the experimental arms are effective, but it's not definitive. He expressed confidence in a data readout in H2 2025.
Jessica Fye inquired about the sustainability of Xywav's 150 net patient additions in narcolepsy, questioning if the recent uptick was reproducible and attributable to the new field nurse educator program.
President and COO Renée Galá confirmed the positive impact of the field nurse educator program on patient persistency. She noted that while narcolepsy adds can be variable, the current demand is strong, driven by new patient starts, transitions from high-sodium oxybates, and a growing appreciation for Xywav's low-sodium profile, which is a key differentiator.
Jessica Fye of J.P. Morgan Chase & Co. inquired about the sustainability of the significant increase in Xywav net patient additions for narcolepsy and the role of the field nurse educator program in this growth.
President and COO Renée Galá confirmed that the field nurse educator program is enhancing patient persistency. She noted that while narcolepsy patient additions can vary quarterly, the current demand is strong, stemming from new patient starts and transitions from high-sodium oxybates, driven by a growing appreciation for Xywav's low-sodium profile.
An analyst on behalf of Jessica Fye asked about the expected contribution of volume versus price to sales growth for key commercial products this year and requested the proportion of VIVITROL, LYBALVI, and ARISTADA sales covered by Medicaid.
CEO Richard Pops stated that while pricing contributes, the majority of expected sales growth is driven by volume. He also clarified that the Medicaid payer mix is relatively similar for all three products, falling in the 45% to 50% range.
Jessica Fye asked what the 2025 guidance assumes for INVEGA TRINZA regarding generic risk, the status of related litigation, and its contribution to the overall royalty revenue line.
COO Blair Jackson clarified that the INVEGA SUSTENNA U.S. royalty expired in August 2024, causing a reset to lower ex-U.S. rates in Q1 2025. He noted that the INVEGA family of products typically contributes about 40% to 50% of the total manufacturing and royalty revenue line.
Jessica Fye asked for specifics on the enhanced LYBALVI commercial access starting Oct 1, the cadence of the gross-to-net increase, the reason for ARISTADA's expected sequential growth despite market softness, and the strategy for share repurchases given the stock reaction.
CCO Todd Nichols specified the new access impacts ~11 million commercial lives and expects the gross-to-net to move into the mid-30s over the course of next year, not in a single step-up. He attributed ARISTADA's Q4 outlook to prescriber breadth and non-retail business growth. COO Blair Jackson noted the company views its stock as undervalued and will be opportunistic with the remaining $200M repurchase authorization, balancing it against cash needs for the business and BD.
Jessica Fye asked a series of follow-up questions, seeking clarity on the Norovirus hold's potential international impact, CMV data timing, the uncertainty around the flu efficacy data requirement for the combo vaccine, and the key variables driving the 2025 revenue guidance range.
President Stephen Hoge addressed the clinical questions, stating no delays are expected for Norovirus internationally and that CMV data is possible mid-2025. CFO Jamey Mock detailed the revenue guidance: the $2.5B high end assumes flat performance, while the $1.5B low end assumes lower COVID share and vaccination rates, plus delays in international manufacturing licensure.
Jessica Fye from JPMorgan Chase & Co. followed up on the HIV program, asking about the factors that will determine the go-forward dose and the potential next steps for the program after dose escalation is complete, including the design of a potential registrational trial.
David Berman, Head of R&D, stated that dose selection will be based on safety, requiring a well-tolerated regimen, and evidence of antiviral activity. He outlined that the typical next step is a randomized Phase II trial with a placebo, although recent literature suggests single-arm trials could be a possibility. CEO Bahija Jallal added that the company will consult with regulatory authorities before finalizing its plans.
Inquired about the timing of the $5 billion CAPLYTA sales forecast announcement and the enrollment progress and data timeline for the ITI-1284 GAD study.
The company felt it was the right time to provide the long-term guidance due to maturing operations, increased confidence from strong MDD data, positive market research, and the primary care sales force expansion. For the ITI-1284 GAD study, they are sticking to previous guidance and not projecting an accelerated timeline for data release next year, though it's not impossible.
Inquired about the new total sales force size after the current expansion, the potential scale of next year's expansion for the MDD launch, and the implications of CAPLYTA qualifying for the 'specified small manufacturer' exception under the IRA.
The sales force will increase by 150 representatives to a total of over 500. Details on the subsequent expansion for the MDD launch will be provided closer to potential approval. The 'specified small manufacturer' exception means the company will face minimal phase-in rebates under the IRA, with no significant impact expected until the end of the decade.
Asked about the assumptions behind the 2024 CAPLYTA sales guidance, including patient penetration, and the expected gross-to-net dynamics for the year.
The guidance is based on strong underlying demand and continued penetration in schizophrenia and bipolar markets through both new and existing prescribers. The gross-to-net percentage is expected to increase from the low 30s in 2023 to the mid-30s in 2024 due to higher commercial volume and improved Medicare Part D coverage.
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