HUTCHMED (China) - H1 2023
July 31, 2023
Transcript
Operator (participant)
Good day, and thank you for standing by. Welcome to HUTCHMED 2023 half-year financial results presentation. At this time, all participants are in listen-only mode. After the speaker's presentation, there'll be question and answer session. To ask a question during this session, you will need to press star one one on your telephone. You will then hear an automated message advising your hand is raised. To withdraw your question, please press star one one again. Please be advised that today's conference is being recorded. I'd now like to hand the conference over to Mr. Mark Lee, Senior Vice President, Corporate Finance and Development of HUTCHMED. Please go ahead, sir.
Mark Lee (SVP of Corporate Management and Communications)
Thank you, Amber. Thank you, everyone, and welcome. At this time, I will remind you that the statements we have are forward-looking in nature, and the results and operations of the HUTCHMED Group are historical, and past performance is no guarantee of future results. That this presentation is intended for investors only and should be read in conjunction with the announcement we just made regarding the results for the six months ended June 30th, 2023, and our various other filings and annual reports. Now, I'll hand you over to Dr. Weiguo Su, our Chief Executive Officer and Chief Scientific Officer.
Weiguo Su (CEO and Chief Scientific Officer)
Thank you, Mark. Good evening. Good morning, everyone. Welcome to HUTCHMED first half 2023 results conference call. Next slide, please. Well, during the first half 2023, we focused on executing on our strategy for, for the long-term growth and also reaching profitability by 2025 goal, including China commercial growth and spending control. We also delivered on our key objectives with our pipeline, highlighted by fruquintinib US NDA and EU MAA submissions, and advancement of multiple programs into pivotal registration studies, including savolitinib second-line gastric, and also HMPL-453, our selective FGFR 1, 2, and 3 inhibitor in second-line cholangiocarcinoma. Fruquintinib US NDA was granted priority reviews designation with a PDUFA date of November 30th, 2023. That means a potential approval before end of 2023. We are working with our partner, Takeda, closely to prepare for the launch in the U.S.
China commercial of the three approved oncology products continued to grow in spite of the pandemic outbreak at the beginning of the year. Next slide. Today, I'm joined by the HUTCHMED senior management team. Johnny Cheng will lead off with a financial update. Johnny, over to you.
Johnny Cheng (CFO)
Thank you, Dr. Su. May I turn, turn to page five, please? Yeah. Okay, a quick review of our balance sheet. Two points I would like to highlight here. One is that we have a strong cash position of over $850 million, mainly contributed by the $400 million upfront payment from Takeda. Secondly, we have completed the construction of our Shanghai factory, of which we have utilized a banking facility supported by the local authorities. This results a loan balance of about $14 million at favorable interest rate of around 3.5%, which is much lower than our deposits rates from the cash debt that we have on hand. Moving on to page six to review our financial performance.
Our consolidated revenue up by 164%, from around $200 million to over $530 million, mainly contributed by the recognitions of the upfront income from Takeda, around $260 million. Our oncology product sales maintained strong growth of 35% at constant exchange rate. The improvements of our other venture business have also contributed to the overall revenue growth. On the bottom line, net income to HUTCHMED has improved significantly from a net loss of $163 million to a net profit of over $168 million. In addition to the recognitions of upfront income from the Takeda deal, reduction of R&D expenditure resulting from the portfolio prioritization and restructuring of our U.S. operation, as well as a higher interest income from our strong cash balance, have contributed to the improvement on the bottom line.
Moving on to page seven. Our oncology product sales, as mentioned earlier, has maintained a high growth of 35% to $80 million. Our overall, our oncology business in total has achieved around $360 million of revenue, three times higher than last year. We are on track to meet our guidance set at the beginning of the year, that is around $450 million-$550 million revenue for the full year. I will now turn, pass to our Chief Commercial Officer, Chen Hong, to share with you the details of our commercial business performance.
Hong Chen (Chief Commercial Officer)
Thank you, Johnny. Good morning, good evening, everyone. I'm happy to update you HUTCHMED's commercial performance in the first half of 2023. As a global science-focused biopharma company, HUTCHMED fully integrated R&D and the commercialization platform. HUTCHMED build up its own oncology commercial platform since 2018 and continuously improve the commercial capabilities and the efficiencies. By the end of June 2023, the sales team size was close to 1,000, covering more than 3,000 hospitals and over 33,000 oncologist specialists. Meanwhile, the government continued to introduce policies to encourage innovative drug development and benefit new drug access to patients, including the implementation of dual-channel pharmacies and the simplification of NRDL renewal process, et cetera. Next slide, please. Elunate was approved for the treatment of third line mCRC in 2018.
Although 2023 is the first year for Elunate to be listed in NRDL, it's still keeping strong growth in the first half of this year. We estimate that there were about 17,000 new patients were treated with Elunate in China in the first half, with 21% growth. According to IQVIA tracking study report, Elunate surpassed regorafenib in terms of patient share since the end of 2021, and that led to growth to about 47% patient share at the end of June 2023. This resulted in $56.3 million in, in market sales, up to 12% growth, which is about 20% at CER growth versus the first half of last year. Next slide, please. Sulanda. Sulanda was launched in China in 2021 for the treatment of all advanced NET patients.
The in-market sales growth in 2022 was very strong, being the first year in NRDL. As a result of our continuous marketing activities, increasing patient access to Sulanda and its long duration of treatment, the total in-market sales in the first half of 2023 accelerate, growing by 66% to around $22.6 million, with estimate 12,000 new patients treated. According to IQVIA tracking study report, in the first quarter, Sulanda had higher patient share than Sutent and Afinitor, which were approved in China much earlier than Sulanda. Next slide, please. Orpathys is the first-in-class selective MET inhibitor to be approved in China and marketed by our partner AstraZeneca in 2021. Following negotiation with China NHSA in January this year, Orpathys has been included in the updated NRDL since March first, with a 38% discount.
The delayed implementation of NRDL, plus the price reduction, led to the flat sales in the first half of this year, with about -5% growth in U.S. dollars and 2% growth at CER. We can see the volume sales grew very strong in Q2, up to 84% comparing to the second quarter of last year. In summary, all our three market products are now included in NRDL, which is in line with our commitment to improve patient access. Despite some initial challenges in the first quarter due to the impact of COVID-19, the in-market sales of HUTCHMED's three novel products continued to grow at 16% to $101 million in the first half of this year. That's all for my part. Thank you.
Weiguo Su (CEO and Chief Scientific Officer)
Zhenping Wu will cover manufacturing update.
Zhenping?
Mark Lee (SVP of Corporate Management and Communications)
Weiguo, perhaps you-- I think he's having some technology problems. Why don't, perhaps you go ahead.
Weiguo Su (CEO and Chief Scientific Officer)
All right. Yeah, I'll, I'll cover for Zhenping. Basically, as you know, we've been building our new factory in Shanghai. At the moment, construction is complete. We are going through equipment validation and also applied for a compliance license, and we should be able to initiate clinical supply manufacturing later this year. At the same time, we will be initiating tech transfer of our commercialized products for this new factory to start commercial manufacturing as well in the future. We're also installing solar panels to be more energy efficient. Next up is Mike to update the pipeline. Mike?
Speaker 13
Thank you, Weiguo. Slide 13, please. Our clinical programs continue to grow and mature and cover a broad spectrum of hematology oncology product. This slide lists 15+ ongoing registration trial for seven leading product globally, including lifecycle indication of market products and late-stage assets with the anticipated NDA filing timeline in the next few years. Fruquintinib, savolitinib, and surufatinib are already on the market in China, two are in global partnership with Takeda and the AZ. HUTCHMED is leading the development of multiple lifecycle indication for this product in China, which I already alluded to. Our next wave of late-stage compounding registration trial, also in the hematology space, two compounds received breakthrough therapy designation in China. Sovleplenib in immune thrombocytopenia, ITP, amdizalisib, our PI3K delta inhibitor in third-line follicular lymphoma.
The EZH2 inhibitor tazemetostat is the first in-licensed product from Eisai, and we are doing a bridging study on registration in China. Notably, new to the list is the HMPL-453, listed in the bottom here, is our FGFR inhibitor and also entered a registration trial in intrahepatic cholangiocarcinoma and leading our third wave product into the registration trial. Next slide, slide 14. Fruquintinib global regulatory filing has been going on very well, which is supported by the results of FRESCO-2 and recently published in The Lancet, and also the data from FRESCO, the China registration trial. NDA for fruquintinib, Dr. Su already mentioned, granted a priority review by the U.S. FDA, PDUFA date is November 30th.
MAA validation has been accepted by EMA in June, also we work our partner, Takeda, is doing the Japan filing later this year. Next slide. Fruquintinib partnership with Takeda has been progressing very well. Johnny already mentioned we have received the upfront payment of $400 million, and also the joint team established and started the collaboration already. Our NDA filing, the MAA and Japan NDA as well on target. On the commercial front, Takeda is initiating launch readiness in advance for the PDUFA date. On the regulatory and lifecycle indication part, joined the Takeda HUTCHMED team already in discussion and also with our external advisors to be held to discuss the LCM strategy.
HUTCHMED is a ongoing clinical program in China may also help inform our clinical development decisions. Slide 16. Fruquintinib NDA for the second-line gastric cancer is already accepted in China, this is based on the FRUTIGA second-line gastric cancer trial, met one of the dual primary endpoint, the PFS, which is statistically significant and clinically meaningful. The other primary endpoint of OS was not a statistically significant per pre-specified statistical plan. We complete our sNDA filing, and the NDA has been accepted by NMPA in April. We hope to extend the patient serving gastric cancer with this high unmet need. Slide 17.
On the fruquintinib lifecycle indication development, we are also very pleased to receive the breakthrough therapy designation in China for the combination with sintilimab, the PD-1 from Innovent, in July, for the treatment advanced endometrial cancer with the proficient mismatch repair subtype. ENC incidence and mortality are projected to grow in China, and the patient who progress on a first-line therapy remains with high unmet medical needs. We have completed the single-arm registration phase II study, and if the favorable results from this trial could lead to the regulatory approval in this treatment setting. Next slide. Slide 18. Sovleplenib is the highly differentiated oral Syk inhibitor with breakthrough therapy designation in ITP in China.
We are particularly encouraged with our phase I/II result, demonstrate the robust overall response rate of 80% and the durable response rate of 40% in relapsed or refractory primary ITP patients. These high response rate are on par with the current widely used second-line treatment for ITP, such as TPO-RA. The same response rate have been shown in patients with previously treated with TPO or not, and much higher than that the existing Syk inhibitor, Tavalisse, in this setting. We believe sovleplenib has the best-in-class potential in the ITP setting, and the results for Phase I study was already published in The Lancet Haematology in April this year. We have complete enrollment of phase III registration trial, ESLIM-01, and I expect the top-line results in the second half. If positive, we prepare the NDA filing in China later this year.
Next slide. Slide 19. Amdizalisib, our differentiated PI3K delta inhibitor, is currently going on with two single-arm phase II registration study in China in the third-line follicular lymphoma and second-line marginal zone lymphoma. The updated phase I data were presented at International Congress on Malignant Lymphoma in June this year, demonstrate the compound is not only promising efficacy with high overall response rate, four-month PFS rate, and duration response rate in lymphoma and MZ, but also favorably safety profile when compared with the same class of compound. As highlighted with the low incidence AE of interest, as well as a low discontinuation rate on the treatment. This, of course, needs to be further confirmed in a larger patient population.
I'm very pleased we have completed enrollment for this pivotal trial in follicular lymphoma earlier this year, and with the clinical readout and the potential NDA filing later this year. Next slide. There are seven registration trial for our MET inhibitor, savolitinib, and all currently enrolling. Three are led by our partner, AstraZeneca, globally and four led by HUTCHMED in China, in multiple cancers with MET amplification, including non-small cell lung cancer and papillary renal cell carcinoma. In addition, we have entered a registration phase in gastric cancer with MET amplification of the POCH trial results presented earlier at AACR this year. Next slide. Our innovative early-stage pipeline continues to grow, and here are only a few examples. I mentioned earlier, HMPL-453, the FGFR inhibitor, has entered registration trial in the cholangiocarcinoma after discussion and in agreement with the CDE.
The clinical proof of concept study were presented at the ASCO this year. The clinical POCH data for HMPL-306, our IDH 1 and 2 dual inhibitor, also presented at EHA this year. The randomized phase II dose has been determined and will consult with the CDE on the registration path forward. We also initiated a combination of a trial of tazemetostat and also PI3K delta inhibitor, amdizalisib, in malignant hematology indications. Also, note mentioning is the newest addition to our early-stage pipeline, including a differentiated SHP2 inhibitor, HMPL-415. Next slide. I'm very proud our R&D team remained focused and executed very well for the first half of the year.
On the regulatory activity, we submitted regulatory filing for fruquintinib, and all on target with our partner, also the Japan, third-line CRC, is also in preparation. We have submitted a supplemental NDA filing for, as I mentioned earlier, for the gastric cancer indication for fruquintinib, MNDA already accepted our application. We received breakthrough designation for fruquintinib plus sintilimab in the second-line endometrial cancer. Also want to mention here, following the dialogue with the PMDA regarding the surufatinib, we have decided not to file a Japanese NDA for neuroendocrine tumor on the basis of clinical trial data available. We also anticipate data readout, potential NDA filing in China for sovleplenib second-line plus ITP and amdizalisib for third-line follicular lymphoma based on the pivotal trial....
Savolitinib first-line non-small cell lung cancer patient with METex14 mutation. First-line data will be presented in September, and that's WCLC. We anticipate the, you know, the individual cancer readout. On the development side, HUTCHMED and our partner, AZ, will continue to complete the enrollment of multiple registration trial for savolitinib in non-small cell lung indications. We also will complete enrollment for fruquintinib plus sintilimab in the renal cell carcinoma. The Heme product will complete the enrollment for amdizalisib in the second line, and MZL and tazemetostat, a bridging study for third line follicular lymphoma. We presented clinical readout for savolitinib in second-line gastric cancer in MET amplified patient at AACR, and initiated the registration trial for savol in the MET amplified gastric cancer.
Also, we have completed the enrollment phase II part of the second line warm autoimmune hemolytic anemia indication, and will decide for phase III of the data readout. To recap our R&D progress, HUTCHMED has a deep and broad portfolio and multiple near-term development catalysts in 2023 and 2024. Our R&D team will remain sharply focused on the execution of our late-stage product development. With that, I wrap up my part of the presentation. I will turn the podium to Dr. Weiguo Su, our CEO and CSO. Weiguo?
Weiguo Su (CEO and Chief Scientific Officer)
Thank you, Mike. Yeah, just next slide, slide 23. A reminder of our near-term goal of turning profitable by 2025. Obviously, we are focused on growing our China business, China commercial, at the same time, you know, managing the control, managing and controlling the spending. Together, hopefully, will allow us to achieve our goal of break even or profit, or being profitable by 2025. Next slide, slide number 24. Now to just sum it up, we had a very strong first half of 2023.
We will continue to focus on our near-term goal, and we are confident that we will be able to deliver on these goals because we have a broad pipeline, and we are working on multiple, on very extensive and robust life cycle indications for our first wave of compounds, namely fruquintinib, savolitinib, and surufatinib, both in China and outside China. At the same time, we are also working to file and register, basically, these compounds outside China, for global patients. Secondly, we are working to file for approval in China, our second wave of compounds, including sovleplenib, amdizalisib, and tazemetostat, in the next six to 12 months. By 2025, we expect to have at least six compounds approved and launched in China.
At the same time, we expect our third wave of compounds to enter into pivotal registration studies in China in the next six to nine months, led by HMPL-453, our selective FGF, FGFR 1, 2, and 3 inhibitor. I mean, all these will present opportunities for NDA submissions in 2025 through 2027 and will position us for, for long-term growth. Overall, I'm quite happy that we had a very strong first half of 2023, and we are quite excited about our long-term prospects, given this extensive pipeline. This will conclude the presentation, and we'll be happy to take any questions.
Operator (participant)
Thank you. We will now begin the question and answer session. To ask a question, please press star one one on your telephone and wait for your name to be announced. To withdraw your question, please press star one one again. Our first question comes from the line of Kelly Shi from Jefferies. Please go ahead, Kelly. Kelly, your line is open. Please ask your question. Sorry, we are not getting response from Kelly. I'll move on to the next question. Our next question comes from the line of Alec Stranahan from Bank of America. Please ask your question, Alec.
Alec Stranahan (VP and Biotechnology Equity Research Analyst)
Hey, guys. good morning slash good evening. Can you hear me?
Weiguo Su (CEO and Chief Scientific Officer)
Yes.
Alec Stranahan (VP and Biotechnology Equity Research Analyst)
Great. Thanks for taking our questions. Two, two from us. First, could you help frame, the, the scope of the top line for, for sovleplenib, sovleplenib and amdizalisib in the second half, you know, in terms of, number of patients and follow-up on the, on the primary endpoints from those studies? Then I've got a follow-up. Thanks.
Weiguo Su (CEO and Chief Scientific Officer)
Yeah. sovleplenib in ITP, it is phase III randomized, placebo-controlled study. In terms of the top-line readout, we expect second half this year, actually, should be fairly soon. We'll obviously announce in due course. Specifically, with regard to patient sample size, it is a total of 180+ patients, randomized 2 to 1, in the 2, in sovleplenib and placebo arms. The durable overall response rate will be the primary endpoint. That, that is about ITP for sovleplenib. Amdizalisib, there are two, actually, there are two pivotal studies ongoing. Both are single-arm studies and with overall response rate as the primary endpoint.
follicular, third-line follicular, we completed enrollment, which is, around 100 patients. The readout should be towards the end of this year.
Alec Stranahan (VP and Biotechnology Equity Research Analyst)
Okay. Would the plan be to present those around a, a scientific meeting or, whenever the data is available, you'll, you'll update the market?
Weiguo Su (CEO and Chief Scientific Officer)
Yeah, of course. Yeah.
Alec Stranahan (VP and Biotechnology Equity Research Analyst)
Okay. Okay, one last question, if I may, just on the commercial readiness activities for fruquintinib. Could you help us paint the picture of what Takeda is doing currently to prepare for the launch in the U.S.? From your side on manufacturing, you know, maybe help us understand, you know, whether that would be in China or, you know, if you would shift manufacturing to other sites to help support the launch. Thanks.
Weiguo Su (CEO and Chief Scientific Officer)
Okay, thanks, Alec. You know, we've been working with Takeda just to support them on the, on, on, on the launch readiness, and obviously, they are driving that the activities. Maybe I'll ask Karen to provide some more details on, on the, on the, on the preparation from Takeda's side. In terms of manufacturing, we qualified two sites for drug product supply. One is obviously our HUTCHMED factory or plant in, in Suzhou, China. The other is in Switzerland, Switzerland. Obviously, you know, we are going through pre-approval inspections and so forth.
You know, likely, the Suzhou plant will, will be the initial, supplier, ultimately, the two sites will, will be supplying global markets. Karen, can you talk a little bit about launch readiness?
Karen Atkin (EVP and COO)
I will. Thanks, Weiguo.
Weiguo Su (CEO and Chief Scientific Officer)
Yeah.
Karen Atkin (EVP and COO)
Yeah.
Weiguo Su (CEO and Chief Scientific Officer)
High level.
Karen Atkin (EVP and COO)
We, we, we're working very closely with Takeda. I think, you know, they, they, they plan, assuming that the outcome of the FDA review is positive, to be ready to go, you know, as soon as we have a positive outcome. They, they've already hired the medical team and the marketing team and are now doing the detailed planning from a sales and a commercial perspective as well. I think, you know, they are taking this very seriously. It's a very important product for them, and we are confident that they will be ready to launch as soon as we know the outcome from the FDA.
Weiguo Su (CEO and Chief Scientific Officer)
Thank you.
Karen Atkin (EVP and COO)
Back to you, Weiguo.
Weiguo Su (CEO and Chief Scientific Officer)
Yeah. Thank you, Karen.
Operator (participant)
Thank you. Do you have any follow-up, Alec?
Alec Stranahan (VP and Biotechnology Equity Research Analyst)
That's, that's great. Thank you.
Operator (participant)
Thank you. Our next question comes from the line of Mike Mitchell from Panmure Gordon. Please go ahead, Mike.
Mike Mitchell (Healthcare Analyst)
Hi there, everyone. Yeah, thanks for taking my questions. First, I was just wondering how the relationship with Takeda might potentially be catalyzing other aspects of business developments. You know, obviously, the focus right now is fruquintinib, but then I think there's a wide and deep pipeline within HUTCHMED. Does that provide a basis for more expansive discussions with Takeda, or do you envisage potentially the deal sort of generating further interest in the pipeline from other third parties?
Weiguo Su (CEO and Chief Scientific Officer)
I mean, obviously, Takeda is a very strong potential partner, and we are working with them at the moment on fruquintinib. They are, you know, a great partner to work with. Yeah, I, you know, obviously, we always constantly talk about potential opportunities for collaborations. I, you know, I, I wouldn't, you know, I, I think it's all, it's, it, it's all project-based. You know, what, yes, we have a very broad and deep pipeline, but, but it's, it's, it's all about, you know, pipeline fit or synergy, if you will.
You know, we just are very happy at the moment working with them on, on fruquintinib, and we'll, we'll definitely explore other opportunities when they when our compounds progress through clinical development when the time is right. Thanks.
Mike Mitchell (Healthcare Analyst)
Got it. Thanks. Perhaps I can just follow up with another question, just in terms of, you know, third-party relationships. Just with AZ, you know, I, I think we saw earlier in the year some press speculation on potentially how A- AZ might evolve its China operations in the future. I'm just wondering how, how you think about that in terms of how any changes in terms of spin-offs or other, other restructuring of AZ China operations, whether or not anything happens, where- how, how that might change your relationship, and particularly in terms of development of savolitinib. How, how are, how are the structures sort of set up in order to be flexed, basically?
Weiguo Su (CEO and Chief Scientific Officer)
You know, changes are, are constant, you know, for almost for every, every company. Specifically for AstraZeneca China, we don't think there is any basis. It's just, we believe it's just a, just a rumor. At the moment, nothing is, nothing has changed in our relationship with AstraZeneca. It's all, playing out according to our original contract.
Mike Mitchell (Healthcare Analyst)
Fantastic. Thanks for that. Perhaps I can just finish with just one final quick one, just on COVID. In terms of the commentary around the sort of impact on Q1, just wondering if there's you've, you've been saying anything further into Q2 or even, even with current the current quarter, just in terms of COVID. I admit I've, I've kind of taken my focus away from COVID impact in recent months, but that would be very helpful. Thank you.
Weiguo Su (CEO and Chief Scientific Officer)
Yeah, generally speaking, the COVID impact was early part of first quarter, January in particular, so it was a bit soft, the first quarter. Second quarter, things now seem to return to normal. We are seeing the trend of things picking up. We don't expect any major issues from second quarter and on. Yeah, pretty much back to normal.
Mike Mitchell (Healthcare Analyst)
Got it. That's great. Thanks, guys. Thanks, everyone.
Operator (participant)
Thank you. Our next question comes from the line of Louise Chen from Cantor Fitzgerald. Please ask your question, Louise.
Speaker 12
Hi, this is Wayne, on for Louise. Congrats on the progress, and thanks for taking our questions. We have two. The first question is on the savolitinib. In press release, you mentioned you might proceed into the phase I in ITP in the U.S., depending on the outcome of the phase III data. What do you need to see here in order to move into the U.S. study? How is it differentiated from the other mechanism of actions, such as FcRN? The second question is, can you discuss your strategy for further build out in the hematology space moving forward, given you already have six investigational drug candidates targeting the hematological malignancies in clinical development? Thank you.
Weiguo Su (CEO and Chief Scientific Officer)
Okay, thanks for the question, Wayne. I think specifically for the U.S. strategy for savolitinib, or for autoimmune diseases, I think the ITP in China would be a major catalyst. If phase III top line results recapitulates our phase, phase I, II data, I think it, it, it would represent a very strong opportunity for global market, we believe. Would expedite the process to initiate our U.S. phase I for autoimmune disease. We do have an active IND in the U.S., and but we do need to quickly confirm the recommended phase II dose for for U.S. patient population, or for global patient population, for that matter.
you know, we believe it, it is a very, it, it is a highly differentiated oral Syk inhibitor. The, the data we presented or published now for sovleplenib phase I/II clearly demonstrated superior efficacy and much improved safety comparing to fostamatinib, which is the only Syk inhibitor approved. We would, you know, we believe it would be a clear opportunity for sovleplenib in autoimmune disease space. We definitely would invest to to, you know, follow the China studies.
In China, we are already evaluating the landscape, and, and, and if the ITP is positive phase III in China, we would follow with additional life cycle indications for, for sovleplenib, and, and the U.S. will catch up once the dose is confirmed. With regard to hematology, I think the space has changed a lot now with the bispecifics and the CAR T, ADC as well. We are evaluating the potential opportunities for the Syk inhibitors. Clearly it is now much more crowded comparing to two or three years ago.
Speaker 12
Okay, thank you so much.
Operator (participant)
Thank you. The next question will come from the line of Paul Choi from Goldman Sachs. Please go ahead, Paul.
Paul Choi (Biotechnology Analyst)
Thank you. Good morning, and good evening, everyone. My first question is on savolitinib with regard to the SAVANNAH trial. Can you remind us if there's an- will be an interim update for that study and when that might come? Are you gonna run that study just to completion ahead of a potential filing for an accelerated approval? I had a couple follow-ups.
Weiguo Su (CEO and Chief Scientific Officer)
We don't, we don't think, we have a interim analysis built into the current phase II s- registration study, s- SAVANNAH study. It, it, it would be just, you know, it, it's a relatively small study, so it will be, it will be just, you know, straight enrollment into completion and, and then report out.
Paul Choi (Biotechnology Analyst)
Okay. Got it. Thanks for that. My second question is on, to follow up on the earlier question with regarding the Takeda collaboration and commercialization in the U.S. Can you remind us if your 2023 oncology guidance is inclusive of any sales, post, post an approval here in the U.S., or should we assume that the first sale would likely come in, in 2024?
Weiguo Su (CEO and Chief Scientific Officer)
There's no royalties built into our guideline for 2023, specifically for for fruquintinib U.S. sales. The the priority review status and and and PDUFA date of before end of the year, all, you know, just played out. We we did not build into our guidance.
Paul Choi (Biotechnology Analyst)
Okay, great. Thanks for clarifying that. My last one is on just regarding collaboration and life cycle development with Takeda for for fruquintinib. When do you think you might be in a position to with your partner, to talk about the development path in markets outside of China for that? Can you remind us of how the cost-sharing is going to work there for future clinical development? Thank you very much.
Weiguo Su (CEO and Chief Scientific Officer)
Yeah. First, on the cost, obviously it will be 100% covered by Takeda. With regard to specific indications to pursue, we've been in discussion with Takeda team. There are obviously a few that we are interested in, or Takeda is interested in as well. We continue to evaluate and, and the opportunities, and also leveraging many proof of concept studies coming, reading out in China as well. Overall, the two, the joint teams have been working together and evaluating different opportunities. We just, we just need to finalize the plan. Maybe, Mike, you can chime in on this.
Speaker 13
Yeah. We have been in active discussion with the Takeda team. I think it's from medical perspective, right? We really focus on quite a few, you know, indications, right? I think both we have shared the China, you know, both HUTCHMED study and also ITP results. I think both team are very engaged, and we also consulting with external KOLs, right, medical experts. Really hope we can shape out some, you know, indication for future development. I think both team are continue to work on that.
Paul Choi (Biotechnology Analyst)
Great. Thank you.
Operator (participant)
Great. Thank you, Paul. Our next question will come from the line of Matthew Yan from CLSA. Please ask your question, Matthew.
Matthew Yan (Healthcare Analyst)
Hi. Thanks for taking my question. Congratulate on the results. I got three questions. First is regarding Orpathys, the SAFFRON study. I know that there is expected to complete recruitment by end of this year. Do you have any plan for any readout for this trial and also the follow-up NDA filing supported by SAFFRON? My second question is regarding the other venture. I noticed that it grew very strong in first half. Can you share more color on this?
My third question is, I think it's quite a concern for a lot of investors over the weekend, is that the Central Commission for Discipline Inspection in China had some talk on the anti-corruption campaign of the healthcare industry in China. I wonder if there was any impact on your commercialization activities regarding this? Yeah, that's my question. Thanks.
Weiguo Su (CEO and Chief Scientific Officer)
So, um, your, your first question on the ongoing-- obviously, that's an ongoing trial and, and, uh, not only just the enrollment, but also, uh, PFS follow-up and so forth. So we don't really anticipate any interim report, uh, of, of the results on- of any ongoing trials. So I don't, and for this one as well, I don't anticipate any, uh, any, uh, um, any reports or publications anytime soon until PFS is mature. Um, your last question about commercial, uh, uh, anti-corruption, so forth, Hutchmed is always, uh, highly compliant with, uh, global quality, uh, global standards of compliance. So, um, uh, we, we don't expect any, uh, any major impact on our commercial operations. What was your, your specific for your second question?
Matthew Yan (Healthcare Analyst)
Oh, the other venture grew, grew by over 50%, so in the first half.
Johnny Cheng (CFO)
It's, sorry, just related to the logistic distribution business, Dr. Su.
Weiguo Su (CEO and Chief Scientific Officer)
Okay, maybe Johnny, you can, you can, provide some more details on this.
Johnny Cheng (CFO)
Yeah, basically, I think the key contributor for the other ventures growth in the first half is related to the growth of our logistic distribution business. Our commercial team there have continued to receive good interactions with the new customers. We have been able to to do this logistic distribution work really well in Shanghai region. That's, that's contributed to the growth.
Matthew Yan (Healthcare Analyst)
Okay, thanks.
Johnny Cheng (CFO)
It's relatively low, relatively low, low-margin business, so I, I think it is the key importance is our oncology product sales growth that has reported 35% growth in the first half.
Matthew Yan (Healthcare Analyst)
Okay, thank you.
Operator (participant)
Thank you, Matthew. Our next question comes from the line of Jack Lin, from Morgan Stanley. Please ask your question, Jack.
Jack Lin (Healthcare Analyst)
Hi. Hello, can you hear me?
Weiguo Su (CEO and Chief Scientific Officer)
Yep.
Jack Lin (Healthcare Analyst)
Hi, thank you for having me for the one of the questions. I just have three quick questions. I think one or two are kind of follow up to previous question. The first one is kind of back to the sovleplenib in terms of phase III readout. I was wondering how, how should the investors and analysts like us frame the top-line results compared to the result that we're being seen for the phase I and II, considering there's a bit different patient enrollment in terms of new line of previous treatments? That's the first one. The second question is in terms of the commercial strategy for sovleplenib, and also, and that was considering the indication that they'll be launching is a bit different from kind of the existing product.
Are we looking to establish new teams or using existing teams, or will we be looking for partnerships to, for their commercialization? I think one final one is just on the kind of the commercial dynamic for Sulanda domestically, right? I see that the, the slides I mentioned, there's 12,000 new patients that was treated the first half of this year. It's a significant increase from last year, while it looks like on the market share side, the majority of market sharing actually went to others, compared to the PowerPoint slides at the full year results. You know, I remember I was just checking, it looks like it's, the first line that went from 16%-17%, while other went from, I think, 18%-23%. Just wondering what's, what's the competitive dynamic in this space right now?
What, if it will be any challenge to continue growing the, the shares in this, market. That's all. Thank you.
Weiguo Su (CEO and Chief Scientific Officer)
Okay, thanks. Thanks for the questions. phase III readouts. I think, you know, you, you, you already seen our phase I/II results, 80% overall response rate and, and 40% durable overall response rate. I mean, these are obviously very strong results, but, but, you know, very small sample sizes here as well. I think it, it, what it would, you know, make sovleplenib stand out is, is its oral, convenient dosing and, and a fast onset of activity. 80% is very robust activity for these patients, you know, heavily pre-treated patients. And it's, you know, it's, it's open arm very, you know, very small study.
Here we, phase III, it's randomized, placebo-controlled, you know, if these data can be recapitulated, it would be a very strong data. Not only comparing to company in the same class, but also comparing to any treatment available for ITP patients. These are, you know, obviously, refractory, highly refractory patients. I think that you, we need to look at the level of efficacy, but at the same time, you know, a safety profile as well. We, we already pointed out early on that we have very low risk of thrombus, thrombosis, basically, you know, with blood clotting formation, with typically seen with TPO or TPO-RA therapies. It's, it, it's, it represents a very severe potential side effects.
Syk inhibitor, sovleplenib, so far, we've seen we have not seen any cases of thrombosis to date and would represent a very low risk there. you know, strong efficacy coupled with good safety profile, low risk of thrombosis, and also fast onset of efficacy that would differentiate sovleplenib from the current currently available therapies and would make it a very competitive product in this category or in this patient population. Commercially, commercial strategy, it is, you know, it is an autoimmune disease. However, these are patients typically in hematology space. A lot of physicians are in hematology, hematologic malignancies, like, you know, lymphoma, leukemia, as we talked, you know.
Even though the, the ITP is not a hematologic malignancy, but a lot of doctors or, or even in the hospital, they are treated by hematologic malignancy physicians. We definitely will have a dedicated team, but, but for this indication, but a lot of doctors will, or physicians will be in, in, in a, in a, in, you know, in the same hematology, you know, hematology space, if you will. For Sulanda, you know, I, I think, you see a lot of a big, you know, we're growing the patient numbers.
You know, you have to understand that neuroendocrine tumors and also the treatments available, this, you know, this is a very highly fragmented disease with, with, you know, different different, they can originate from different tissues or different organs. And also, the hallmark for this disease is that, you know, you typically don't see very high response rates. What happens is that patients experience many of them, and even the majority of them, experience a stable disease. So they can control the disease. They sometimes see some tumor tumor shrinkage or tumor regression, but not to the point of response.
Oftentimes they, they, rotate on, they rotate on to some other treatments, and then they come back to the same treatment, to Sulanda, for instance. There, there's definitely some rotation going on. By far, you know, patients treated so far with Sulanda, they're by far majority are, neuroendocrine tumor patients.
Jack Lin (Healthcare Analyst)
Got it. Understood. Thanks so much.
Weiguo Su (CEO and Chief Scientific Officer)
Okay.
Operator (participant)
Thank you, Jack. We will now take our final question from the line of Clara Dong of Jefferies. Please ask your question, Clara.
Clara Dong (Senior Biotechnology Equity Research Associate)
Hi, can you hear me?
Weiguo Su (CEO and Chief Scientific Officer)
Yep.
Clara Dong (Senior Biotechnology Equity Research Associate)
Great. Yeah, this is Clara on for Kelly. Congrats on the progress, and thanks for taking my question. Just a question on fruquintinib. ASCO, you showed subgroup analysis of fruquintinib, including overall survival in patients across different line. Could you maybe talk about the timeline and development plan to support the earlier line approval and use, and do you, do you plan to run additional studies?
Weiguo Su (CEO and Chief Scientific Officer)
Yeah, I'll ask Mike to comment on this. Mike?
Speaker 13
Yeah, this is part of-
Weiguo Su (CEO and Chief Scientific Officer)
Earlier lines of CRC.
Speaker 13
Right. Lifecycle management and indication discussion, as I mentioned earlier, we've been actively in discussion with Takeda on the LCM plan, right? Certainly, earlier line of indication is also what we are considering. At, at this point, we're further evaluating data. Let's mention, we certainly have some China data show earlier line, you know, fruquintinib can be combined with, you know, chemo, immunotherapy, demonstrate signs of clinical activity and the safety. Certainly, moving to earlier lines is a possibility, but we're still continue to discuss and evaluate with Takeda.
Clara Dong (Senior Biotechnology Equity Research Associate)
Thank you.
Speaker 13
Thanks.
Operator (participant)
Thank you. Thank you all very much for your questions. I'll now turn the conference back to our speakers for any closing remarks.
Weiguo Su (CEO and Chief Scientific Officer)
Mark, you have any comments or to sum it up?
Mark Lee (SVP of Corporate Management and Communications)
Thank you, everybody, for, for joining. Weiguo, do you have any comments?
Weiguo Su (CEO and Chief Scientific Officer)
No, I'm... No, not from me.
Mark Lee (SVP of Corporate Management and Communications)
Okay. Thank you, everybody, for joining, and, if should you have any questions, please feel free to contact us. Happy to, to, to answer your questions or, or, or just organize a meeting if there's anything that's not clear in anything we've spoken about today. Thank you all.
Operator (participant)
Thank you. That concludes today's conference call. Thank you for participating. You may now disconnect.