Q1 2024 Earnings Summary
- Incyte's acquisition of Escient Pharmaceuticals adds two first-in-class medicines (EP262 and EP547) to its inflammation and dermatology pipeline, potentially addressing a range of indications and strengthening its position in the dermatology market.
- The company is progressing its CDK2 inhibitor program, with plans to release substantial clinical data later this year focused initially on ovarian cancer, representing an important opportunity in the CDK2 inhibitor landscape.
- Despite new competitors, Incyte expects Jakafi to remain the market leader in first-line myelofibrosis due to its overall survival benefit, tolerability, and symptom relief, with continued growth driven by polycythemia vera and graft-versus-host disease indications.
- Delays in Key Pipeline Programs: Incyte's mutant-CALR antibody data is not expected until 2025, and the company has not decided the scope of data disclosure for this program, indicating potential delays and uncertainties in their pipeline progress. ,
- Jakafi's Growth Concentrated Outside Myelofibrosis: While Jakafi's growth is driven by GVHD and PV, the myelofibrosis market is stable with limited growth prospects, which may impact future revenue growth from this key product. ,
- Uncertainty in Capital Allocation Strategy: Management is non-committal about returning cash to shareholders through dividends or share buybacks and is focusing on acquisitions, which may not align with shareholder interests seeking capital returns. ,
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Jakafi Growth Outlook
Q: How will Jakafi growth dynamics look given IRA and competition?
A: Management is optimistic about continued growth of Jakafi, expecting 2024 and 2025 to be "just fine". They see little impact from competitors, maintaining market leadership in myelofibrosis with stable duration of therapy and no increase in discontinuations. The company benefits from the IRA's small biotech exemption, helping patients with reduced out-of-pocket costs without affecting the company's financials. -
Opzelura Sales and Guidance
Q: Can you provide guidance on Opzelura sales and refill rates?
A: Management is waiting for more real-world data, especially for vitiligo, before providing guidance on Opzelura sales. For atopic dermatitis, refill rates are stable at slightly over 2 tubes per patient. In vitiligo, refill rates are growing but not yet at steady state and currently lower than anticipated. -
Impact of Change Healthcare Cyberattack
Q: What was the impact of the Change Healthcare issue on Opzelura and Jakafi?
A: The cyberattack on Change Healthcare caused an estimated $4–5 million negative impact on Opzelura sales in Q1. Demand has since returned to pre-attack levels. There was no significant impact on Jakafi. -
ALK2 PoC Data Expectations
Q: What should we expect from the ALK2 PoC data set?
A: The ALK2 program aims to demonstrate clinical benefit in treatment-naive myelofibrosis patients by ameliorating anemia through hepcidin inhibition. If they can show a clinical proof-of-concept with meaningful hemoglobin improvements, they may advance the program toward regulatory discussions. -
BET Inhibitor Safety Concerns
Q: Do AML incidents with competitors' BET inhibitors impact your program?
A: Management has no concerns regarding AML transformation with their BET inhibitor program, with close to 200 patients treated to date without such issues. Preclinical studies also showed no genotoxicity concerns. -
Povorcitinib Development in Atopic Dermatitis
Q: Will you develop povorcitinib in atopic dermatitis?
A: Encouraged by recent data from RINVOQ, management is contemplating developing povorcitinib in atopic dermatitis but has not made a final decision yet. -
Capital Allocation and Share Buybacks
Q: Will you consider share buybacks or dividends?
A: While prioritizing external opportunities like acquisitions, management is considering all options, including share buybacks, but nothing is excluded from discussions. -
Ex-US Opzelura Launch Progress
Q: How is the ex-US launch of Opzelura progressing?
A: The European launch is progressing well, with reimbursement agreements in Germany, France, Italy, and Spain, contributing to Q1 sales. Full operations in these countries are expected by Q3. -
Pipeline Strategy in Dermatology
Q: Where do you aim to win in dermatology over the next 5 years?
A: Management is building a portfolio of first-in-class or best-in-class medicines in the inflammation space, including the acquisition of Escient and development of drugs like povorcitinib and novel therapies from Escient's pipeline. -
Mutant-CALR Antibody Development
Q: Will mutant-CALR antibody be combined with Jakafi?
A: Yes, the plan is to combine the mutant-CALR antibody with Jakafi to provide early symptom relief while aiming to eradicate the malignant clone in myelofibrosis and essential thrombocythemia. -
Jakafi XR Progress
Q: How is Jakafi XR progressing and what's the strategy?
A: The XR formulation process is underway, expected to complete in time for loss of exclusivity, allowing for a once-daily dosing without affecting combination strategies. -
Tafasitamab Data Expectations
Q: How meaningful will the upcoming tafasitamab data be?
A: Management expects the data to be meaningful, with studies in low-grade lymphomas and first-line diffuse large B-cell lymphoma completing, and data expected in the second half of 2024 and Q1 2025. -
Focus on Targeted Oncology
Q: Can you describe your strategy in targeted oncology?
A: The company is moving aggressively into targeted oncology, focusing on well-defined patient populations and early proof-of-concept, leveraging assets like their KRASG12D program and oral PD-L1 inhibitor for potential oral–oral combinations. -
CDK2 Inhibitor Program Progress
Q: What is the progress and expectations for the CDK2 inhibitor program?
A: The program is progressing well, with dose selection data expected later this year, focusing initially on ovarian cancer and planning combination trials while also enrolling patients with breast cancer.
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