Judah Frommer

Judah Frommer with Morgan Stanley sought more color on Arcutis's confidence in raising the full-year 2026 guidance, considering the strong Q4 results but anticipated seasonality in Q1. He asked about the specific contributions of formulary access, sales force additions, and other model inputs to this increased confidence.

Answer

President and CEO Frank Watanabe and Chief Commercial Officer Todd Edwards attributed the raised guidance to strong Q4 momentum and strategic investments, including the dermatology field sales force expansion and the launch into primary care/pediatrics, with impacts expected in the second half of 2026. Todd Edwards reiterated that exceptional formulary access would continue. He explained that Q1 seasonality is typical due to deductible resets and insurance plan changes, leading to higher gross-to-net rates, which are expected to improve throughout the year.

Judah Frommer inquired about the confidence behind raising the full-year guidance, particularly considering a strong Q4 but an anticipated seasonality-affected Q1, asking for a breakdown of contributing factors like formulary access and sales force additions.

Answer

Todd Edwards, Chief Commercial Officer, attributed the confidence to the exceptional momentum in Q4, coupled with strategic investments: the dermatology field sales force expansion and the primary care/pediatric investment, both expected to impact the second half of 2026. He reiterated continued exceptional formulary access. For Q1, he explained typical seasonality due to deductible resets and insurance plan changes, leading to higher copay usage and a higher gross-to-net rate in the high 50s, which will gradually improve throughout the year. He expressed confidence in sequential quarter-over-quarter growth from Q1 to Q4.

Judah Frommer from Morgan Stanley requested more detail on the pediatric atopic dermatitis opportunity, particularly the potential penetration ramp compared to adults. He also asked for an update on the status of the Patagus litigation.

Answer

Chief Medical Officer Patrick Burnett and CEO Frank Watanabe highlighted the significant unmet need in the 2-to-5-year-old pediatric AD population, driven by parental concerns over topical steroid use, suggesting a strong fit for Zareve's profile. Regarding the litigation, Frank Watanabe confirmed that a confidential periodic update was provided to the court as required, and all parties agreed that the stay on the case will remain in place.

Judah Frommer inquired about the company's ability to fund itself to profitability, specifically how pipeline programs like APL-9099 and APL-3007 might impact the timing and trajectory of achieving profitability, and what factors could accelerate or delay it.

Answer

Chief Financial Officer Timothy Sullivan stated that all pipeline costs have been incorporated into the company's financial outlook, anticipating a modest increase in total operating expenses for 2026, compared to flat levels in 2024 and 2025. He noted that while FSGS and DGF studies are ramping and new programs like Beam are coming online, the company has been effective at managing operating expenses. Timothy Sullivan emphasized that profitability ultimately depends on revenue growth, and the company was close to an adjusted EBITDA neutral level in the past year, expecting more focus on this in 2026.

Judah Frommer inquired about the company's ability to fund itself to profitability, specifically how the pipeline, including APL-9099 and APL-3007, might impact the timing and trajectory of achieving profitability, and the pushes and pulls that could move it closer or further out.

Answer

CFO Timothy Sullivan stated that all pipeline impacts have been incorporated into the company's financial outlook, anticipating a modest increase in total operating expenses for the current year compared to flat levels in 2024 and 2025. He noted that the ramping FSGS and DGF studies, along with the Beam program (APL-9099) coming online later in the year, represent potential larger cost structures. Sullivan emphasized the company's disciplined approach to managing operating expenses, with profitability ultimately dependent on revenue growth. He added that the company has been close to an Adjusted EBITDA neutral level over the past year and expects this to come into sharper focus this year.

Judah Frommer of Morgan Stanley asked if achieving high GA market penetration requires a next-generation product and requested details on how the Sobi royalty transaction will be recorded financially.

Answer

CEO Dr. Cedric Francois expressed confidence in Cyfovri's stable business and strong data, while positioning the next-gen combo product as a way to enhance efficacy and convenience. CFO Tim Sullivan explained the upfront payment from the Sobi deal will be recognized as revenue and appear as cash on the balance sheet.

Judah Frommer from Morgan Stanley asked if Apellis believes it can achieve its target market penetration in GA with Cyfovri alone, or if a next-generation product is necessary. He also had a housekeeping question on how the Sobi royalty transaction will be recorded financially.

Answer

CEO Dr. Cedric Francois expressed confidence in Cyfovri's stable, growing business and highlighted the next-gen APL-3007 combo, which aims to improve efficacy and convenience. CFO Timothy Sullivan explained the Sobi transaction is simple: the upfront payment will be recognized as revenue and will appear as cash on the balance sheet.

Judah Frommer of Morgan Stanley asked if achieving high market penetration in GA requires a next-gen product or can be done with Cyfovri alone, and also inquired about the accounting for the Sobi royalty transaction.

Answer

CEO Cedric Francois expressed confidence in Cyfovri's stable, gradual growth, supported by four-year data. He positioned the next-gen APL-3007 combo as a way to enhance efficacy and convenience. CFO Tim Sullivan explained the Sobi transaction simply: the upfront payment will be recognized as revenue and will appear as cash on the balance sheet.

Judah Frommer of Morgan Stanley asked if achieving long-term GA market penetration requires a next-generation product or can be done with Cyfovri alone, and also asked how the Sobi royalty deal will be recorded financially.

Answer

CEO Dr. Cedric Francois positioned the next-gen siRNA combination as a way to enhance Cyfovri's already impressive profile by improving convenience and efficacy, reinforcing their leadership. CFO Tim Sullivan stated the upfront payment from the Sobi deal will be recognized as revenue and added to cash on the balance sheet.

Judah Frommer asked about the competitive dynamics of sampling, including whether the competitor is also providing more samples, and if Apellis's sampling strategy differs for new versus existing practices.

Answer

Executive Cedric Francois stated that Apellis's sampling program is available for all physicians to ensure patient treatment can continue, especially given the co-pay funding issues. He noted that samples are used across both new and established practices. He declined to comment on competitor-specific sampling data but reiterated that samples are a useful tool for Apellis under the current circumstances.

Judah Frommer inquired about any shifts in Sephience reimbursement dynamics since the initial launch, particularly concerning approvals for first-line therapy. He also asked about PTC Therapeutics' strategy for prioritizing business development opportunities versus advancing its internal early-stage R&D pipeline, given its strong financial position.

Answer

Chief Business Officer Eric Pauwels reported favorable shifts in reimbursement, with commercial and government payers establishing policies that are generally prior authorizations to label, with limited or no step edits and 6-12 month refills. CFO Pierre Gravier stated that PTC is in a strong financial position to support both commercial expansion and R&D, and is open to disciplined business development to accelerate top-line growth while maximizing shareholder returns.

Judah Frommer asked about any shifts in Sephience reimbursement dynamics since the initial launch, particularly for patients approved for first-line therapy. He also inquired about the company's prioritization strategy for business development, balancing the internal early-stage pipeline with potential external opportunities.

Answer

Eric Pauwels, Chief Business Officer, noted favorable shifts in reimbursement with commercial and government payers, resulting in policies that are primarily prior authorizations to label, with limited or no step edits and 6-12 month refills. Pierre Gravier, CFO, stated that with $1.95 billion in cash, the company has the financial strength to support both the Sephience launch and internal R&D pipeline, while remaining open to disciplined business development opportunities to accelerate top-line growth and maximize shareholder returns.

Judah Frommer from Morgan Stanley questioned the strategic rationale behind allocating capital to buy out the Senta royalty obligation for Sefiance, asking about the return hurdles compared to other uses of cash like BD. He also asked for an update on interactions with partner Novartis regarding the Huntington's program.

Answer

CEO Dr. Matthew Klein and CFO Pierre Gravier described the Senta transaction as a strategic and accretive deployment of capital, reflecting high confidence in Sefiance's billion-dollar-plus U.S. potential and offering a high return. They affirmed that the company retains significant firepower for other BD opportunities. Regarding Novartis, Dr. Klein noted the teams are working well together with a shared sense of urgency to meet with the FDA to align on the efficacy trial and discuss accelerated approval pathways.

Judah Frommer questioned the extent of engagement with the nutritionist community for the Sephience launch and asked about the differences in commercial ramp strategies between the U.S. and Europe.

Answer

CEO Dr. Matthew Klein highlighted that nutritionists are integral to the launch plan, with PTC hiring them for its medical team. CBO Eric Pauwels explained that the U.S. and German launches will have similar timing, with the U.S. converting patients from its disease website and Germany converting patients from a compassionate use program, making both key revenue drivers in H2 2025.

Judah Frommer inquired about the implications of the pembro approval in platinum-resistant ovarian cancer (PROC) for Rina-S.

Answer

CEO Jan van de Winkel and Chief Development Officer Judith Klimovsky addressed the question. Klimovsky acknowledged the pembro approval in PROC as a potential option but noted its restriction to PD-L1 positive CPS1 above 1% (70% of the population) and the inclusion of weekly taxol. She believes Rina-S can be more transformative by serving the full broad population.

Judah Frommer inquired about the implications of the recent pembrolizumab approval in platinum-resistant ovarian cancer (PROC) for Rina-S.

Answer

Chief Development Officer Judith Klimovsky acknowledged the pembrolizumab approval as a potential option for patients but noted two key limitations: it's approved only for PD-L1 positive patients (around 70% of the population) and involves weekly taxol. She expressed belief that Rina-S could be more transformative and serve the full, broader patient population.

Judah Frommer of Morgan Stanley asked for an update on trial enrollment progress, investigator feedback, and whether the oral administration format was resonating with patients.

Answer

CEO Nello Mainolfi reported that enrollment for the 28-day study had exceeded their goals, which he attributed in part to strong patient interest in an oral therapy. He noted that the decision to exclude a placebo arm was made to support enrollment, and that the upcoming Phase 2b study would provide more insight into patient preference for an oral option versus biologics.

Judah Frommer inquired about the Duchenne muscular dystrophy (DMD) community's reaction to the RGX-202 prophylaxis regimen and the drivers behind the improving efficacy of Suravec in diabetic retinopathy (DR) between year one and year two.

Answer

President & CEO Curran Simpson stated that interest from the DMD patient community is at an "all-time high," with the proactive immune suppression regimen having greater appeal. Chief Medical Officer Dr. Steve Pakola explained that for Suravec, the durable and improving efficacy at two years suggests disease modification, which, combined with a strong safety profile, prompted the decision with partner AbbVie to advance to a new pivotal trial design to maximize potential efficacy.

Judah Frommer of Morgan Stanley requested an update on the Phase III trial planning for diabetic retinopathy with AbbVie and asked if there have been any recent changes in the nature of interactions with the FDA across REGENXBIO's portfolio.

Answer

President and CEO Curran Simpson characterized FDA interactions as "business normal" with good continuity in review teams. Regarding the diabetic retinopathy program, he confirmed they are finalizing the pivotal protocol with AbbVie after receiving global regulatory feedback and are still targeting the first patient dose in 2025.

Judah Frommer inquired about the specifics of REGENXBIO's available nondilutive financing options, asking for insights into the probabilities of realizing capital from the AbbVie DR milestone, a potential PRV monetization, and the Zolgensma royalty stream. He also asked about expectations for a potential FDA Advisory Committee (Ad Comm) meeting for RGX-202.

Answer

Chief Financial Officer Mitchell Chan detailed the three nondilutive financing sources. He explained the DR milestone from AbbVie is contingent on the first patient being dosed, making it a timing risk. The Priority Review Voucher (PRV) monetization depends on regulatory approval for RGX-121, and the Zolgensma royalty stream reverts after a cap is met, with timing dependent on Novartis's sales. CEO Curran Simpson added that the PRV has a high probability due to positive pre-BLA FDA meetings. Chief Medical Officer Dr. Steve Pakola addressed the Ad Comm question, clarifying for RGX-121 that while they don't currently anticipate one, they are prepared and confident in their data if one is convened.

Judah Frommer of Morgan Stanley inquired about the consistency of interactions with mid and lower-level members at the FDA and whether there have been any changes in the regulatory teams they engage with.

Answer

CEO Kabir Nath affirmed that their engagement with the FDA's psychiatry division has been consistently excellent, a benefit of their breakthrough therapy designation. He stated there have been no changes to staffing, responsiveness, or the level of engagement, and the day-to-day relationship remains strong and tightly aligned.

Judah Frommer asked whether new U.S. collaboration partners are more interested in the platform due to supply issues or the program's efficacy, and also questioned if SpinCo might focus on neurology given the new CEO's background.

Answer

CEO Paulus Stoffels noted significant interest from hospitals in the DMU network, which is being built out to serve regions with multiple large medical centers. CFO Thad Huston addressed the SpinCo question, stating that while the primary focus remains oncology, immunology, and virology, other areas could be considered depending on the deal.

Questioned how Galapagos views competitors' moves to expand CAR-T manufacturing (e.g., Gilead, Bristol/Cellares) and whether this validates the need for point-of-care therapy, and if Galapagos believes it has a lead with its Cocoon system.

Answer

Competitors' moves confirm the growing need for CAR-T capacity. Galapagos believes its Cocoon system is differentiated and holds a leading position in decentralized manufacturing due to its global scalability, 7-day vein-to-vein time with fresh cells, and ability to address access issues for critically ill patients.

Judah Frommer from Morgan Stanley asked for Galapagos's perspective on competitors like Gilead and Bristol Myers Squibb expanding CAR-T access, questioning if this validates the need for point-of-care solutions and whether Galapagos feels it has a lead with its Cocoon system.

Answer

CEO Paul Stoffels asserted that the Cocoon system offers unique benefits, including global scalability, a 7-day vein-to-vein time for critically ill patients, and the ability to address significant access gaps. Head of Development Oncology Jeevan Shetty added that Galapagos is differentiated by delivering a fresh, non-cryopreserved product, which they believe is supported by superior translational data.

Judah Frommer inquired about Atai's capital allocation priorities given its extended cash runway, the strategic focus between later-stage programs and platform building, and potential read-throughs from COMPASS Pathways' upcoming Phase 3 design. He also asked for updates on the PCN-101 program, including trial design, success criteria, and progress on its subcutaneous formulation, and sought details on the strategy for the RL-007 program in CIAS.

Answer

CEO Florian Brand and CSO Srini Rao responded. Florian Brand highlighted the extended runway to 2025, secured by a $175M debt facility and pipeline reprioritization, which allows focus on key clinical readouts without anticipating new funding needs. He also affirmed support for COMPASS's new leadership and indication expansion. Srini Rao detailed the PCN-101 Phase 2a trial, emphasizing that low dissociation is a key success factor for potential at-home use. He also discussed the RL-007 program, noting its unique polypharmacology and plans for a Phase 2b trial.

Judah Frommer of Credit Suisse inquired about the timing and potential hurdles for the PCN-101 subcutaneous formulation, the strategic purpose of biomarkers (enrichment, regulatory, or IP), and the company's cash priorities and program spending.

Answer

CSO Dr. Srini Rao confirmed that both PCN-101 IV trial data and subcutaneous bridging study results are expected by year-end, with no major formulation issues anticipated. He explained biomarkers serve for patient enrichment, IP, and potential inclusion in the drug label. CFO Greg Weaver highlighted the company's strong cash position with a runway into 2024, while CEO Florian Brand noted that capital allocation is a dynamic process based on program data.