Genmab - Earnings Call - Q2 2020
August 12, 2020
Transcript
Speaker 0
Thank The may differ materially. For example, as a result of delayed or unsuccessful development projects. Genmab is not under an obligation to update statements regarding the future nor to confirm such statements in relation to actual results unless this is required by law. Please also note that Genmab may hold your personal data as indicated by you as part of our investor relation outreach activities in order to update you on Genmab going forward. Please refer to our website for more information on Genmab and our privacy policy.
And now without further delay, I would like to hand the conference over to our speaker today, Jan van De Winkle. Please go ahead, Jan.
Speaker 1
So hello, and welcome to the general conference call to discuss the company's financial results for the first half of this year. With me today to present these results is our CFO, Anthony Pagano, and we will be joined for the Q and A by our Chief Development Officer, Judith Klemoski and our Chief Operating Officer, Anthony Monsini. Let's move to Slide two. As already said, we will be making forward looking statements, so please keep that in mind as we go through this call. Let's move to Slide three.
I'm proud to say that despite the universal challenges posed by the COVID-nineteen pandemic, Genmab not only had a strong second quarter, but a transformative one. Two key events have occurred since we presented you with our first quarter results. We reported very favorable top line results for tisotumab vedotin in cervical cancer. And of course, we announced our broad foundational oncology collaboration with AbbVie. Starting with the most recent event, the highly anticipated tisotumab vedotin data in late June, we along with our partner Seattle Genetics announced that the innovative two zero four trial of tisotumab vedotin for patients with recurrent or metastatic cervical cancer have met its primary endpoints with a twenty four percent confirmed overall response rate and a median duration of response of eight point three months.
We very much look forward to discussing these results with the FDA and the potential for the first BLA submission for one of our proprietary therapeutic candidates, which would be an important milestone in our company's history. Our landmark Epi collaboration was also one of the most anticipated events of the year for Genmab. Genmab and Epi will be equal partners working together to jointly make all strategy clinical development and commercialization decisions for pre GEMMA bispecific antibody therapy, abcoritamab, Duo Hexabody CD37 and DuoBody CD35 T4, as well as potential novel differentiated cancer therapies created under a discovery research collaboration. So this collaboration sets us on a path to accelerate, broaden and maximize the development of some of our promising bispecific antibody therapies, including efcoritamab, with the ultimate goal to bring differentiated new potential therapies much faster to cancer patients. So as you can see on the slide, we have advances to report that two of these potential therapies, as we recently dosed the first patient in an expansion cohort for efgartigimod and initiated a first in human trial of DuoBody CD35 T4.
I would also like to mention that there is now a Phase three trial by Janssen for amivantamab as first line treatment in non small cell lung cancer listed on clinicaltrials.gov. This represents the first Phase three trial for a DuoBody therapy and we very much look forward to this study being initiated. In addition, you may have seen the very impressive results from the two ASKLABIOS Phase three trials of ofatumumab in relapsing MS that were published on August 6 in the prestigious New England Journal of Medicine. Of course, DARZALEX also remains an important factor in our success. Another major 2020 milestone was achieved in second the quarter with the subcu formulation of DARZALEX called DARZALEX FASPRO in The U.
S, approval in both The U. S. And in Europe. This is the first and only subcu CD38 antibody approved in the world, and we look forward to potential approval in Japan as well, following Janssen's submission of an NDA there in April. As a reminder, there is also potential for approval based on Amgen's CONDOR study of daratumumab in combination with carfilzomib and dexamethasone in relapsed or refractory multiple myeloma with submissions by Janssen to regulatory authorities in The U.
S. And Japan in Q1, as well as a submission by Amgen in Europe in the same quarter. And while daratumumab may already be considered an important therapy for multiple myeloma, we continue to see the potential for further expansion in positive line data sets. At the May, we saw the first Phase III results from an indication outside of multiple myeloma with the positive top line data from the ANDROMADES study of subcu daratumumab in combination with cyclophosphamide, flotetuzumab and dexamethasone, or in short, CyborDex, for patients with newly diagnosed AL amyloidosis. This was followed very recently by positive results of the Phase III and post study of daratumumab plus pomalidomide and dexamethasone or POMDAX in relapsed or refractory multiple myeloma.
This study was designed to confirm the results from the Phase I AQUELUS trial, which investigated the IV or intravenous formulation of daratumumab in combination the same combination, and which was the basis for an approval in The U. S. In 2017. Finally, and very excitingly, we reported eighteen thirty eight million dollars in net sales by J and J during the first half of the year, an increase of 31% over the 2019, resulting in DKK $652,000,000 in royalties to Genmab. Given the challenging coronavirus situation, we are pleased with DARZALEX's performance in the 2020 and we look forward to seeing the further impact of the subcu formulation as it continues to be rolled out by Janssen.
I will now turn the call over to Anthony Pagano to present our detailed financial results for the first half of twenty twenty. Anthony, go ahead.
Speaker 2
Great. Thanks, Jan. Let's move to Slide four. Before I get into the results and the guidance, I'm going to spend a moment reiterating our overarching financial framework because I think we have materially strengthened what was already a strong foundation with our AbbVie collaboration. First off, let's look at our revenue profile.
On the left, you can see the component parts of our current and future recurring revenue streams. It starts with DARZALEX. And here, we are looking forward to continued growth and expansion. And you can also see ofatumumab and TEPEZZA. We're excited about the potential ofatumumab approval in RMS that is expected in September.
And the TEPEZZA launch is off to an exceptionally strong start. Next, on to R and D investment shown on the right. And this is one of the areas where our collaboration with AbbVie is going to make a real difference. We'll continue to be focused and disciplined in our approach. And as we've told you before, we're going to continue to expand and accelerate our potential winners.
But clearly, the cash from AbbVie and the fact that we're sharing the investment in the existing clinical programs on a fifty fifty basis means we'll be able to do more and faster. Stepping back, what continues to stand out for me from this overall framework is that Genmab remains a resilient business with a very high quality product pipeline and great growth prospects. And these prospects have now been further strengthened by our collaboration with AbbVie. We see this collaboration kind of like a turbocharger towards our 2025 vision. With that intro, we can turn to slide five.
If you attended our call on our transformational collaboration with AbbVie, then the information on this slide will look familiar to you. As a reminder, here are its key elements. This is one of the largest oncology partnerships in history with a potential total deal value of up to $3,900,000,000. This includes the upfront payment of $750,000,000 and 3,150,000,000.00 related to the achievement of additional development, regulatory, and sales milestones, and opt in payments. The collaboration includes three existing clinical programs.
And it is important to remember that we've got material commercialization rights for these potential products, which will enable us to build and increase our commercial footprint. And we'll do that with an initial focus on The US and Japanese markets. We've also agreed a broad research collaboration combining the r and d capabilities of both companies. This is definitely a situation where the whole is greater than the sum of the parts, and we've got the potential to create four additional differentiated next generation antibody product candidates. Overall, this is a partnership that further strengthens our financial position and supports our evolution into a fully integrated biotech powerhouse, all working towards our 2025 vision.
Now let's move to DARZALEX on Slide six. Here we saw continued strong performance with only a modest COVID impact in the second quarter. You can see that in the chart on the left. As noted by J and J during their first half results call, DARZALEX saw continued strong market growth and share gains in The U. S.
And overall DARZALEX worldwide sales grew by 31% year on year. That's net sales of $1,840,000,000, which translates to 1,650,000,000.00 Danish kroner in royalty income for Genmab. Now calculating the exact impact from COVID-nineteen is difficult, especially as we have limited insight into sales in countries outside The US. But as we highlighted during our first quarter call, we believe this is a short term delay and not a fundamental disruption. And that's because of the seriousness of the disease and the need for patients to be treated, coupled with DARZALEX's strong product profile.
Additionally, we expect to see continued uptake of the subcu formulation, which was approved in the second quarter. So for the 2020, we anticipate that sales will ramp up, and we're already seeing early signs of that in The U. S. So DARZALEX continues to be on a clear path to market leadership in multiple myeloma and remains a key driver of our revenue, as you can see on Slide seven. Looking at the graph on the left, you can see that there were three significant contributors to the increase in revenue in the first half.
First, we recognized nearly 90% of the $750,000,000 upfront payment from AbbVie. Now clearly, it's important to remember that that's a one off contribution. And second, DARZALEX royalties grew more than 40% compared to the 2019. Finally, you see other, and most of that $97,000,000 comes from TEPEZZA. And we've seen a really strong start here.
As you may have seen, Horizon has now raised its 2020 sales guidance for TEPEZZA. Of course, it's early days, but we see this as a very promising launch. Now if we take DARZALEX and TEPEZZA together, we're really pleased to have seen recurring revenues grow by 47% in H1. As well as increasing revenues, we also increased investment in our pipeline, in our team and in our capabilities, as you can see on the next slide. On the graph on the left, you can see the major drivers of our increased investment in the first half of the year.
In total, operating expenses increased by DKK $521,000,000, which was driven by the accelerated investment in our product portfolio, including the advancement of both epiritamab and dual body PD L1 four-1BB. We also spent more on expanding our very talented team. We've continued to hire key team members to support our growing product pipeline, and we've continued to build our commercial capabilities. With the upfront from the AbbVie collaboration, our revenue growth significantly outpaced the higher investment levels, driving 4,570,000,000.00 kroner of operating income. Now having looked at the individual parts, let's look at our first half twenty twenty financials as a whole on Slide nine.
Here, you will see a P and L summary. In the first six months of the year, revenue came in at DKK 6,340,000,000.00, an increase of nearly DKK 5,000,000,000 compared to the 2019. The increase was primarily driven by the upfront payment from AbbVie and higher DARZALEX royalties. Total expenses in the 2020 were DKK 1,780,000,000.00, with 84% being R and D and 16% G and A. Operating income, as I noted, was DKK 4,570,000,000.00 compared to DKK 111,000,000 in the 2019, driven by higher revenue.
And that brings us to our net income of DKK 3,600,000,000.0. So an extremely strong 2020 despite the COVID-nineteen pandemic, which brings me to our guidance on Slide 10. We are updating certain aspects of our 2020 guidance previously published on June 10. We now expect our revenue to be in the range of DKK 9,100,000,000.0 to DKK 9,700,000,000.0, an increase of DKK 200,000,000 to the top end of the previous guidance. This is still driven by the upfront payment from AbbVie and the continued growth of DARZALEX, complemented by a strong start from TEPEZZA.
We continue to anticipate our 2020 OpEx to be in the range of DKK 3,850,000,000.00 to 3,950,000,000.00. Putting this together, we're planning for substantial operating income in 2020 in a range of 5,200,000,000.0 to 5,800,000,000.0 kroner. Now I'll move to my final slide. Clearly, COVID nineteen continues to affect everyone's lives. I think in times like this, it's useful to take a step back and reflect on our business and financial position.
We have a very strong foundation, even stronger now with our collaboration with AbbVie. Especially important in today's environment, we've got a robust balance sheet, $1,900,000,000 of cash at the end of the second quarter, and no debt. We have great recurring revenues, and they're growing. And we're using those revenues to invest in a really focused and disciplined way. We're investing in our highly innovative and differentiated product pipeline as well as in the team and capabilities to deliver it, all driving towards our 2025 vision.
Now I'll turn it back over to Jan.
Speaker 1
Thanks, Anthony. Let's move to Slide 12. So looking at this list, we set many ambitious goals for ourselves in 2020. Based on the robust progress we've made year to date, our strong financial foundation and our world class expertise and capabilities, I'm confident that we will continue to be successful in the remainder of this year. Not only will our proprietary clinical pipeline continue to advance the many regulatory milestones on this list and some of which have already been met, including this spectacular launch for TEPEZZA means that there is potential for many more patients to one day have access to and hopefully benefit from novel therapies created by Genmab.
Let's move to Slide 13. This ends our presentation of Genmab's first half twenty twenty financial results. Before we take your questions, I wanted to point out one of the events we have listed on this slide here, our twenty twenty Capital Markets Day taking place in November. For the safety of our attendees and speakers, the event will be virtual this year, but it will still feature a comprehensive update on our business and presentations from many of our talented and passionate team members. We will be sending a safe date for this event soon and details on how you can register and listen to the webcast will be available on our website closer to the event.
So now operator, please open this call for questions.
Speaker 0
Our first question is coming from the line of Peter from Citi. Please ask your question. Your line is now open.
Speaker 3
You. Pete Verdult, Citi. Jan, just one question on the data that we can expect in 2020 and 2021, particularly thinking about a four-1BB PD L1 and Epco in terms of incremental data and Phase III plans. So could you just map out for us what we can expect for those two assets data wise and strategy wise in 2020 and 2021? Thank you.
Speaker 1
Thanks, Peter, for the question. I will start with that question, and then I will ask Jure to basically add to that. So for PD L1x4-1BB DuoBody, we expect data in the coming months, Peter, at the conference, and that will be data from the dose escalation and maybe limited data also from the expansion cohorts. For efcoritamab, we expect also data in the coming months at a key conference, and that will be at the optimal dose level for Epco in different B cell tumors. That is for 2020.
For 2021, I will ask Jurets to give you some further perspective on data from these two compounds data and potentially others like tisotumab, fedotin, daratumumab, etcetera. Judith, maybe you can step in here.
Speaker 4
Yes. Thank you, Jan. So for 2020, nothing to add, but we are very well on track for those two major milestones. For 2021, we haven't mapped yet, but it could be the case that we could present some more data toward the 2021 on p a one for one b b, but it's not yet mapped. So take it with a grain of salt.
It's a little early for the projections, but for we are on track for 2020.
Speaker 1
Thanks, Judith. Thanks, Peter.
Speaker 0
Thank you. Our next question comes from the line of Wimal Kapadia from Bernstein. Please ask your question. Your line is now open.
Speaker 5
Great. Thank you very much for taking my question. Wimal Kapadia from Bernstein. Just following up with Pete's question on the PD L1 for 1BB. Jan, you previously mentioned six patients were treated with the product and you had seen good responses, including in PDX failures
Speaker 3
and that you
Speaker 5
had selected a Phase II dose. So I just wondered if you had any incremental color to add. And in particular, I appreciate that the molecule looks relatively potent from what we've seen so far. So any additional color on tolerability would be greatly appreciated. Thank you.
Speaker 1
Thanks, Wimal, for the question. I think we have to keep very brief here until we present the data. And I could tell you, we have actually now treated a pretty nice number of patients, and that includes patients who either already treated with other checkpoint blockers, VBAL, or patients with tumors which are normally not responsive to checkpoint blockers. And you will probably have to wait until we present the data, but we are super excited about this compound. As Anthony already mentioned in the introductory remarks, Wimal, we have stepped up this program considerably.
And so we did for the Aqualitamab program this year. And we are really a company who want to invest in a potential winner. So we think that this is this one is a potential winner in a very exciting, expanding market for where we really need new and differentiated drugs, I think, to help cancer patients better. But I think you have to wait the clinical presentation in the coming months. But we're very excited.
That's probably where I want to keep it at. Okay. Thanks very much. Thank you.
Speaker 0
Thank you. Our next question comes now from the line of Michael Schmidt from Guggenheim. Please ask your question. Your line is now open.
Speaker 6
Hey, guys. Thanks for taking my questions. I just had a bigger picture questions on efcoritamab. I was just wondering, Jan, if you could maybe just share your vision for the longer term development plan for this antibody just given that in DLBCL, for example, there it seems like the it's getting a little bit more crowded with novel antibody and ADCs entering the market there in addition to CAR T. And I was just curious how you think about the optimum development strategy longer term for efgartigimod?
Speaker 1
Thanks, Michael, for the question. I will start with that answer and then we'll also ask Judith to complement me on that. I can tell you that we have very big plans for advericumab. We are continuously dosing patients. We have started dosing in the expansion cohorts, Michael.
And one of the ways we're seeing is that not only do we think that we have a very competitive molecule in the cases like diffuse large B cell lymphoma, follicular lymphoma, we are also having a very active molecule as it now looks at other types of B cancers. B cancers, compounds are far less active and potent. So we think that we can actually in one way open up new markets basically with this asset, which is given in a subcutaneous formulation, which we think has very distinct advantages, Michael, of the IV delivered antibodies. And we're going to penetrate all of the lines of treatment in different B cell tumors. We are working with our partner Epi now to work on a very comprehensive, very aggressive plan.
And that's probably where I want to keep it at for the time being, but certainly new insight this year, certainly data, Michael, at key conferences. And yes, we only get more and more excited about this asset. And also in the context of the competitive landscape, we've seen some other compounds struggling from other companies recently. And so we think there is real opportunity here for a game changing differentiated novel B cell targeting antibody therapeutics. So we believe that we have one of the potentially best in our hands here.
We have a very strong partner, AbbVie. Maybe I can hand over to Judith to see whether whether you can shed further color without going into detail on the development plan here.
Speaker 4
Yes. No. Thank you, Yan. So the vision is based on the data and the data so far and the data that you will see we're coming by the other day, it speaks to the fact that this euphorizoma can be best in class. It's not only the subcutaneous formulation, but also the efficacy and safety.
And based on that and leveraging on partnership with Avi, We have marked a very thorough comprehensive plan, and you will see more in clinicaltrials.gov and when it becomes public in coming months. So stay tuned. Basically, I cannot disclose the clinical development plan because for you need to understand it's a competitive space. But, again, the competition encourages us because we we we truly believe that we have something in hand that is differentiating and better.
Speaker 1
Thanks, Judith. Thanks, Michael, for the question.
Speaker 0
You. Your next question now from the line of Matthew Harrison from Morgan Stanley. Please ask your question.
Speaker 7
Great. Good afternoon. Thanks for taking the question. I guess two for me that I just wanted to ask. One, can you just talk a little bit about Axle and what you're doing internally decide how you may move that compound forward or not?
And then on TIZO, now that you have the pivotal data in hand, how are you thinking about potential other indications with solid tumors? And, you know, when might we hear something about that? Thanks.
Speaker 1
Thanks, Matt, for the questions. I'm going to hand over both to Judith, who's having all the development. Judith, maybe you can give her perspective on Axon.
Speaker 4
Yeah. Yeah. Thank you. So for Axle, as we made public, like, when we presented the data in September, we are in the process of optimizing the PK and understanding the biomarkers data to guide us farther on potential future steps. The biomarker piece, you know, is with fresh biopsies.
So it's taking a little bit longer, you know, in terms of recruitment given that they have that is important on patients in the COVID era. But we still are confident that by the end of the year, have enough data to guide us on future steps. So this is with regard to AXA. With regard to this automobile team, I want to first, you know, echo Ian and how excited we are about the data in cervical cancer. And so per se, the data is exciting.
But in addition, you know, we can take it as proof of concept for tissue factor as a target for potential other tumors. Because as we know, a tissue factor is broadly expressed in other tumor types, I mean, particularly those with very bad prognosis. So this is why we started in partnership with Seattle Genetics, the basket study and the ovarian study. And in ovarian, we have an interesting signal even in the phase one expansion in the thirty patients there. So we are looking at monitoring very closely with CGM the progress of the basket study and what we enroll like four different tumor types and to understand where we gather enough data of substance that represent in public domain.
So it will be in in the future at certain points, so stay tuned. I cannot provide a commitment because we are monitoring it closely, but we expect to have data in the future.
Speaker 1
Thanks, Sheila. Thanks, Sheila, for the question.
Speaker 8
Our following question comes from the line of Trun Yoon from Credit Suisse. Please go ahead.
Speaker 9
Hi, guys. Thanks for taking my questions. I've got a couple on Dara. Can you just give us a bit more color on the progress of the subcu Dara? I know it's pretty early in the launch, but are you seeing any kind of accelerating use in DARA in the earlier lines of therapy?
And are you seeing you managing to get, you know, capture new patients, new DARZALEX patients with this subcu formulation? And then perhaps can you update us where you are on the penetration you have with dara across all of the lines of therapy? Thanks very much.
Speaker 1
Thanks, Twang, for excellent questions, and I'm happy to actually hand them over to Anthony Montsidi, our Head of Operations. And Anthony will give you a good perspective for both of these questions. Anthony?
Speaker 10
Hi. Thanks for the question. I think we're, as Anthony Pagano mentioned earlier, we're really pleased with the strong growth and share gains across DARA for the 2020 and the Fast Pro launch overall. I think JT has really done a nice job on the Fast Pro launch with early rapid access in The U. S.
With NCCN listing very quickly as well as all of the details related to access like P and T and Pathways lining up really well. And the customer feedback on FastPro has been very positive to date, with them replaying the fact that there's a significant benefit both to patients and offices related to reduced chair time and short duration of in person visits. So when you have a three to five minute injection, as Yan mentioned, versus a several hour infusion, it's particularly valuable in a COVID-nineteen environment. So we're very pleased with the overarching update. In fact, the launch uptake of FastPro is tracking at a similar pace to DARZALEX overall, and we really look forward to seeing a continued positive impact of this subcu formulation in the second half.
Just to comment a little bit about market shares in terms of your question. Overarching market share in the latest data point was 24%, which is the highest overall patient share that DARZALEXA has achieved to date. And it's really being driven by earlier and earlier lines of usage of DARZALEX. So in the frontline setting, to last year, we're seeing a threefold increase in frontline uptake, so 9% in the latest data point and 3% in last year at the same time. But really, what's driving a large part of the gains is the second line patient setting, where DARZALEX achieved 42% overall share, and that compares to about 34% last year.
So overall, I think really strong uptake of the FAST Pro, not just in The U. S, but actually around the world. And we're looking forward to much more of that in the back half of the year in order to reaffirm our guidance that Anthony referred to earlier of $3,900,000,000 to $4,200,000,000 And maybe Anthony Pagano, you can comment further on that on the guidance.
Speaker 2
Yes. Thanks, Anthony. I mean, overall, as you've heard from us today and I guess if I take a step back, right, let's start with that very, very strong product profile for DARZALEX. I think for those of you who have heard me say it before, it really is the complete package. I think looking at the seven approved indications, now the subcu, the approval in 85 countries, reimbursement in 40 countries, now more than 100 and thirty thousand patients treated.
So I think overall, sort of we're very happy with the first half of the year. Obviously, we saw a little bit of softness in April, some stabilization in May. But as we exited Q2 and got into Q3, we really like what we're starting to see here, particularly in The U. S.
Speaker 1
Thanks, Anthony. Thank you, Quinn, for the questions.
Speaker 8
And our following question comes from the line of Kennen MacKay from RBC Capital Markets. Please go ahead.
Speaker 11
Hi. Thanks for taking my question, and congrats to the team. I certainly agree with you, Yan. This has really been a really transformational year despite, everything going on with COVID nineteen. So my question is also on the four one b d, by P1 duo body.
You're enrolling a number of different cancers with really varying degrees of immunologic temperature, we say, from lung cancer to triple negative breast cancer, which is basically the extreme of hot versus not. So from the emerging trial data or biomarker data, really any other distinguishing features or differentiation, which tumors are you so far most excited about for the full one dd DuoBody?
Speaker 1
Thanks. I
Speaker 4
can take these ones. I can take this one. Yeah. Yeah. Thank you.
So, you know, as as you alluded to, by design, it's a one component of the study. It's not restrictive, and then we have expansion. And because of the mechanism of action, which is totally different, you know, because it's not just the blockage of the p d one, p d l one axis, but the conditional activation of four one b b, we see the opportunity broader and the potential to impact tumors that are traditionally sensitive to p ones or checkpoint inhibitors like p one p ones. And those which are, like, difficult or non sensitive. So you and part of this data will be presented
Speaker 0
at
Speaker 4
the future meeting, and you will see more by yourself. So we represent actual data. And based on that, you know, the cohorts that were selected for the expansions are to dissect out biologically what are the different tumors that we can grow. And there you have some cohorts that focus on these sensitive tumors where, you know, they can collapse or didn't respond to or which would be, like, the post checkpoint scenario or tumors that today cannot be tackled by p d one and p l ones. And so this and and so these cohorts will give us the data and the benchmark with current p d one, p d l ones inhibitors.
So by the end of the year, we will have this update on the dose escalation that will give you more color and the basis for the expansions.
Speaker 11
And, Judith, maybe just a follow-up on that. The data are presented, I'm just trying to understand if we'll have sufficient data to really sort of make a call on efficacy here. Is this gonna just sort of be PKPD or will we also be response rate? Do you think, you know, duration of response rate? Will it just be too
Speaker 4
Oh, no. Okay. Yeah. Yeah. It's a little bit so so it's a phase one dose escalation.
So the objective of the study is to determine the recommended phase two dose and safety. But, you know, we also collect the activity, so some activity will be presented. For sure, you know, the dose escalation won't give you it's not designed per se for efficacy but for safety. But, you know, you will see some preliminary activity on the postage calculation. This data will be presented as any additional if any other phase one.
Speaker 1
Thanks, Thanks, Kennen.
Speaker 0
Thank you. Our next question comes now from the line of James Gordon from JPMorgan. Please ask your question, James. Your line is now
Speaker 12
Hello. Thanks for taking the question.
Speaker 1
James Gordon from JPMorgan. My question is about CD three, CD 20. So Roche's.
Speaker 12
They recently got breakthrough designation in FL. Just curious. Does that change your view about sort of how far you are in terms of time to market behind them? Are you also seeing an expedited route? Does everyone get sped up or just whoever gets there first?
That was the question. But if I
Speaker 1
could also just squeeze in
Speaker 12
a quick clarification as well. So for one b b, given the timing of the CMT on November 13,
Speaker 0
is
Speaker 12
it possible that you actually presented the data at sixty, so November, so you're actually gonna have the data at the CMT, and it already will have been at a conference?
Speaker 1
I I think I will pause. Thanks, James, for, for joining. Thank you for the questions. I think both questions will go to Ewlett. And Yeah.
And maybe you can start with the Ewlett, Ewlett.
Speaker 4
Yeah. So APCO, you know, we for sure, I mean, we are aware of the data from every other asset in the c three c twenty space or in the lymphoma space. You know, it make us even more excited that what we have done in two years, you know, from 13 new women to recommend it phase two dose and expansions and makes us even working harder with our partner, Abby, to try to take any other step to safely accelerate. And this is what we are doing. So, you know, we know that the space is competitive, but we know the value that Echo could potentially bring to patients.
So, you know, it doesn't change if the plan rather encourages us to work harder and better and with more excellence. And with regard to period one four one b b, could you repeat the question?
Speaker 1
Sure. The the question is in terms of when exactly we see the data. So I know you're having a Capital
Speaker 12
Markets Day, I believe, on the on the November 13, and I believe the SITC virtual conference. Yes.
Speaker 4
You will see the data in the medical conference.
Speaker 12
Got you. And so that could be in time for the CMT as well to be discussed?
Speaker 4
Yes.
Speaker 12
Okay. Thank you.
Speaker 0
Thank
Speaker 1
thank you, Judith. Thanks, James. Very sharp question.
Speaker 8
Our following question comes from the line of Emily Fields from Barclays. Please go ahead.
Speaker 13
Hi. Thanks. I was just gonna try to get a little bit more precise on the last question just because I know in prior communications this year, you talked about closing the gap with Roche. So I know we
Speaker 1
Are you still there, Annalene? I don't think we hear you. Operator, is she still there?
Speaker 8
I think your line dropped.
Speaker 1
I think line dropped, but I think the question was closing the gap between aperitamab and Roche's most most most most most Maybe you that you can say a bit more on how we think we can actually progress the up call.
Speaker 4
Yeah. No. Thank you. I so this is what I said. You know, we are actively working hand on hand with Avi to to try to safely accelerate and close the gap as much as possible.
We we cannot quantify in months, but the fact that we started expansion cohorts, it tells you that, you know, we have caught up substantially. These studies are received received when this and we will continue in that taking this momentum to to continue as further rating.
Speaker 1
Thanks. And you and and then, Emily, when you hear the the the recording, we will definitely follow-up with you and see if Ali has additional questions.
Speaker 4
Yeah. And just only one thing. I mean, we never say, like, close the gap, but our goal is to minimize the gap and to shutting the gap as much as possible in a realistic manner. Yep.
Speaker 1
Thanks. Alright, operator. I think we can take the next question.
Speaker 8
Our following question comes from the line of Scott Limo from SEB. Please go ahead.
Speaker 14
Thank you very much. Karsten Limbo from SEB. Another question on your your CMD. I was wondering whether you see the CMDs as strictly as a science event, but whether there will also be some financial outlook. Maybe what I'm trying to understand here is whether you would maybe consider updating your 2025 vision with maybe some financial targets now that you're a more mature company.
Would that be something that you could discuss with us clearly? Thanks.
Speaker 1
Hey, Karsten. Thanks for the question. What we're thinking about is, of course, the growth will be on the science and on the products. We have some very exciting things. Cooking now at German pipeline has never had the quality it has now, and we want to give you further insight in that and then some use of the novel technology platforms.
But we will, of course, also speak about some financial aspects, how we see the future, and also about the next phase and and basically investing wisely and selectively in the potential. But the bulk will be on the scientific and the development angle.
Speaker 14
Great. And then just a follow-up to that because now we're talking about finances. Could you also maybe answer the audio detail the increase in the G and A cost for the quarter? How much of this was the commercial cost related to tisotumab?
Speaker 1
Oh, that that's that's I I hand that question over to Anthony Burcan, our customer. He can handle that for sure. Thanks. Anthony?
Speaker 2
Yeah. So so great. So so, Carsten, yeah, mean, looking about sort of the the higher, G and A costs, you know, I think there are a couple of moving parts here. Right? In terms of, you know, R and D versus G and A split, you know, for q one this year, we're at $87.13.
And for q two, we're at 81 versus 19. If I put those two quarters together for the first half of the year, we're at $84.16. Right? And maybe now sort of talk you through these actual moving parts with that that framework. So for for the h one two thousand twenty, you know, we have higher costs compared to last year, and a lot of this is down to incremental costs following our US IPO in July 2019.
Separately, apart from those sort of ongoing recurring costs, separately for q two thousand q two two thousand twenty, we do have some one off costs that we've heard in conjunction with the AbbVie collaboration. So if we were to exclude these one off costs, you know, you know, r and d and g and a cost split for q two would be more similar to what we saw in in q one. So there are some moving parts here, you know, parts then, but there is certainly this one off, you know, you know, element that I just described, which is impacting the number.
Speaker 14
Okay. Makes sense. Thanks.
Speaker 1
Thanks, Anthony. Thanks, Karsten, for the questions.
Speaker 8
And the following question comes from the line of Emily Field from Barclays. Please go ahead.
Speaker 0
Hi. Can you hear me now?
Speaker 13
Yes. Great. Go Sorry. I totally haven't. I, thanks for answering my other question.
I just had another follow-up. I believe in one of the prior answers, you mentioned, in, at current med having a place kind of across all lines of therapy. I just wanted to dig into that, you know, in terms of, you know, what maybe you see as the ideal place place for the drug in terms of the treatment paradigm in DLBCL, whether, you know, relapsedrefractory second line, if you could just give some more thoughts on that.
Speaker 1
Thanks, Emily. I'll pass the question over to you, Doug.
Speaker 4
Yeah. No. Thank you for the questions. I think it's it's premature. I think that there are still unmet medical needs in every line of therapy, and this is what I'd like most excited about because, you know, this is where the impact on patients would be more evident and remarkable.
But still, yeah, I think that we are looking of opportunities to improve the whole continuum of treatment given the differential aspects and potential transformative nature of c three c twenty. So I will stop there. Thanks, Judith. Thank you.
Speaker 1
Thanks, Emily.
Speaker 8
Our following question comes from the line of Laura Stoeckley from UBS. Please go ahead.
Speaker 4
Hello. Thank you. Just a quick one on DARZALEX, please. Could you give us any thoughts on how you're looking at the potential in the amyloidosis market? And in particular, any thoughts around duration would be welcome.
Thanks.
Speaker 1
Thanks, Laura, for the question. I think I will first hand it over to Judith and then probably Anthony Montsini. Judith?
Speaker 4
Yeah. So yeah. Thank you, Jan. So for amyloidosis, I mean, I I am personally as a hematologist. I'm super excited about this result because, as you know, there are no drugs approved in amyloidosis.
And then so it's it's really rewarding as a hematologist, like, to see something that provides such a benefit in terms of organ damage. Because as you know, many tried, but nothing succeeded. So, again, I mean, talking about the full package of Darzalex. In terms of market, it's hard to predict because the prevalence, like in The US, for example, they say that it's twelve thousand patients dealing with amyloidosis. But as you know, when there are no good treatments, diseases are not in the radar screen of physicians and therefore not diagnosed, underdiagnosed, or diagnosed late.
So part of the I mean, it's it's very hard to predict. I mean, what is underneath the the the worker, let's say, that the patient's population that have amyloidosis that they don't get the Congo red test to be diagnosed because, you know, there's no awareness if there is not a good treatment. So part of the understanding the commercial opportunity is working on on on really an awareness campaign not only because this is not a disease that comes through hematologist. It comes through cardiologists, through nephrologists, through clinicians because this is the primary form symptoms of the disease. So this is from a medical background.
Now, Anthony, if you want to elaborate more on yeah.
Speaker 10
Thanks, Judith. No. Thanks, Judith. I I don't know that I can have much more except to say that, really, this is great news for patients. As you mentioned, it's an area of huge unmet medical need and yet another positive data set to add to the many positive DARZALEX data sets.
I think once filed and approved, J and J is probably best positioned to provide more color on incremental impact and and your and duration. It's a great question, Laura. Thank you.
Speaker 1
Thanks. Thank you, Laura. Thanks, Anthony.
Speaker 8
Our following question comes from the line of Greg Savannavej from Goldman Sachs. Please go ahead.
Speaker 15
You for taking my questions. Congrats.
Speaker 2
Hey. Can you hear me? Hello?
Speaker 1
Yes. We can hear you now. Yep.
Speaker 15
Okay. So sorry about that. First of all, thanks for taking my question, and congrats on all the progress and and your achievements here to date. I I had just one question on capital allocation. You've got almost you've got a very nice cash balance right now.
And I'm just wondering as you think about your business, where are you prioritizing investments? Is internal pipeline? Is it around commercialization? Are you thinking strategically around BD opportunities? Any color around how you're thinking about that would be appreciated.
Thanks,
Speaker 1
Greg, for the question. I will first hand it over to Anthony Percano and then see whether Anthony wants to add anything on the commercialization, which is a very important part of the company now going forward. Anthony Pagano?
Speaker 2
Yes. So, yeah, you know, Greg, good to hear your voice and chat with you today. Yeah. So look, I think, first of all, was thinking about our balance sheet. You're right, sort of pointing out, we do have a strong balance sheet.
And I think this has sort of been very useful for us here over the most recent period. Right? I think more recently, we sort of think about being able to look through, you know, any issues as it relates to COVID nineteen with that from that position of strength. That the strong balance sheet, also meant when we, worked for negotiating and what ultimately, resulted in the wonderful collaboration with AbbVie that we were also negotiating from a position of strength for that collaboration. And I think moving forward, the strong balance sheet is gonna continue to be super important as we execute towards our 2025 you know, vision.
And now with, you know, the the T cell data,
Speaker 15
you know, there's potentially
Speaker 2
a clear path to to market there. We'll look and wait and see and work our way through the FDA interactions, but we're super excited about that. We're also looking at our pipeline and how that's maturing. Having that that rock solid balance sheet means that we can absolutely, execute against, moving those programs forward and our 2025 vision with sort of the absolute confidence and the power of the balance sheet behind us. Sort of thinking a bit about our maybe OpEx levels moving forward, we're gonna continue to be focused and disciplined as we invest in invest in our business and the growth opportunities that are in front of us.
The thing we think about being focused and disciplined, there are there are really two sides of the coin. Right? You know, on the one hand, we think about discipline. We can think about derisking investments and when we can and making tough decisions along the way. That's really around discipline.
On the other hand, you know, thinking about focus, it starts with our our focused strategy that we've alluded to that we've been been executing against since 02/2013, and that's our 2025 vision. Right? So we're really laser sharp focused, you know, on on delivering against that. And as it relates to, final point, Greg, as it relates to kind of external opportunities, I think we'll continue to be focused there. Right?
And the theme I've talked about, you know, more recently is is really where we can be natural owners. Right? Where we can be good evaluators of what we're bringing in and then ultimately good owners of it once we have it in house. So I think, at least for the the shorter term, more of the same in terms of the deals we've done more recently. Maybe Anthony, Mancini, you want add some stuff on the commercial side?
Speaker 10
Yeah. No. Look, I I would reiterate what Anthony Pagano mentioned in terms of, you know, how the the AbbVie collaboration is a critical step, towards our twenty five twenty twenty five vision. And part of investing behind that thoughtful step is really being thoughtful about our priorities from a commercialization standpoint. And we've taken steps now to start to build our commercial organization in The U.
S. And Japan, recently making key strategic appointments there, and we'll continue to do that. And looking externally, we'll continue to look for, as Anthony Padano talked about, opportunities to complement what we have, opportunities to deepen what we have and accelerate our quest to achieve that vision and beyond. So I think I'll leave it there, Jan, and pass it back to you. But thanks, Greg, for the question.
Speaker 1
Thanks, Anthony. And Anthony, I think, Greg, we will leave it with this here.
Speaker 2
Okay. Thank you.
Speaker 8
Our last question comes from the line of Tasheen Jain from Bank of America. Please go ahead.
Speaker 16
Hi there. Thanks for fitting me on
Speaker 12
to the call. Just a
Speaker 16
couple of pipeline questions to wrap up. On etacritamab for the for the DMD in November, do you be able to sort of outline the full Phase III program at that point? And why then do you expect to have visibility on how you close the time line versus competition on the fast market strategy? If you're able to give us further color there. Second question is on Hexavolet C38.
Do we still expect some initial data from that through 2021? And then the final question, obviously, there's a lot of slight growth coming to year end, but I wonder if you could just flag some earlier stage assets which will be giving initial data next year that we could perhaps begin to focus on now. Thank you.
Speaker 1
Thanks, Sebastian. Let me start with with question two. I will give the first one to Yurik so that he can think about what will be known at the time of the Capital Markets Day and have communicated separately given the competitive landscape on epcoritamab. So for Hexamorty CD38, we still plan to move it into the clinic this year. So it's fully on schedule session.
And I think at the very earliest end of next year, we could see some data, but more likely in 2022. And then in the new year, probably some early data from some of the programs which are now in the clinic. We now have several new programs in the clinic. It could be the dual HexaBody CD 37 program, but that could be in the second half of of twenty one, I would say, and for the dual body CD three five before, probably second half of next year at the very earliest or in '22 more realistically. Maybe you can give some further color to Sachin on the full phase three program for adulitamab as we are working on a plan with that fee.
Speaker 4
Yeah. So, you know, we at the Capital Market Day, I mean, we won't disclose all our plans because,
Speaker 0
you know, this won't be smart
Speaker 4
and, you know, from our part, you know. But by November, there would be and I as if, you know, the clinical development is, like, a map, so you will have two more three points on that map to guide you on the whole journey. But we will never ever discuss at the Capital Market Day, you know, the whole clinical development plan We don't why to do that.
Speaker 1
Thanks. Thanks, sir.
Speaker 2
Thank you. Yeah.
Speaker 1
Thanks. Thanks, Sachin.
Speaker 8
And there are no further questions at this time. Please go ahead.
Speaker 10
Alright. So thank you all for
Speaker 1
calling in today to discuss Genmab financial results for the 2020. We were if you were not able to to to give your question or you you were unable to to get with us with the question, please reach out to the investor relations team. We hope that you all stay safe. Remain healthy, keep optimistic, and very much look forward to speaking with with you again soon. And this concludes the call.