Y-mAbs Therapeutics - Earnings Call - Q4 2024

Executive Summary

• Q4 2024 revenue rose 13% year over year to $26.5M, driven by $2.0M license revenue (Nobelpharma) and 78% ex-U.S. DANYELZA growth; U.S. DANYELZA declined 12% on unfavorable price mix. Net loss was $(6.8)M or $(0.15) per share; cost of goods sold elevated by inventory write-off and mix.
• 2025 guidance introduced: FY revenue $75–$90M; OpEx ex-COGS $116–$121M (incl. COGS $129–$134M); cash investment $25–$30M; Q1 2025 revenue $18–$21M; runway “into 2027.” Management emphasized realistic guidance given dispersion in Street estimates.
• SADA PRIT platform advanced: 22 patients dosed in Part A GD2-SADA; 9 GD2-positive proceeded to therapeutic lutetium; no dose-limiting toxicities; full Part A readout planned in Q2 2025—a key 2025 catalyst.
• Strategic realignment created two business units (DANYELZA and Radiopharmaceuticals); cash and equivalents $67.2M with 2024 cash investment $11.4M (better than guide), reinforcing liquidity ahead of pipeline milestones.

What Went Well and What Went Wrong

• What Went Well

  • Strong ex-U.S. momentum and licensing: ex-U.S. DANYELZA +78% YoY to $7.7M; $2.0M Nobelpharma upfront drove license revenue; patent extension through Feb 2034 supports durability.
  • Platform validation without safety signals: “no dose-limiting toxicities and no treatment-related serious adverse events” in SADA Part A; full data in Q2 2025.
  • Operating discipline and liquidity: cash $67.2M; 2024 cash investment $11.4M, below $15–$20M guide; management reiterated runway “into 2027”.
  • Quote: “We delivered on the strategic priorities we set out to achieve in 2024 across our business.” – Michael Rossi, CEO.

• What Went Wrong

  • U.S. DANYELZA softness: U.S. net product revenue fell 12% YoY to $16.8M on unfavorable price mix despite slightly higher volume; payer mix moving toward Medicaid/340B pressured margins.
  • Gross profit compression and COGS spike: COGS jumped to $7.6M (incl. $0.6M inventory write-off), reducing gross profit to $18.9M vs $21.3M YoY; mix shift to regions with lower margins noted.
  • Higher SG&A and lower other income: SG&A increased on personnel/severance; interest/other swung to $(1.6)M due to lower FX gains and interest; quarterly net loss widened YoY.

Transcript

Operator (participant)

Good morning and welcome to Y-mAbs Therapeutic Incs earnings conference call for the fourth quarter and full year 2024. At this time, all participants are in listen-only mode. Instructions for the question-and-answer session will follow the prepared remarks. As a reminder, today's conference will be recorded. I would like to hand the call over to Y-mAbs Head of IR, Courtney Dugan.

Courtney Dugan (VP, Head of Investor Relations and Corporate Affairs)

Thank you, Operator, and good morning, everyone. Welcome to the Y-mAbs fourth quarter and full year 2024 financial results conference call. We issued a press release with our results this morning before the market open. The press release and accompanying slides are available on the IR section of our website. Let me quickly remind you that the following discussion contains certain statements that are considered forward-looking statements, as defined in the Private Securities Litigation Reform Act of 1995.

Such statements include, but are not limited to, statements about our business model, commercialization and product distribution plans, expectations with respect to our business unit realignment, expectations with respect to clinical trial data, expectations related to current and future clinical and preclinical studies, and our research and development programs and regulatory submissions, potential regulatory marketing and reimbursement approvals, collaborations or strategic partnerships and the potential benefits thereof, expectations related to our anticipated cash runway and cash investment and the sufficiency of our cash resources and assumptions related thereto, financial guidance and estimates for the first quarter and full year of 2025 and beyond, and other statements that are not historical facts.

Because forward-looking statements involve risks and uncertainties, actual results may differ materially from those expressed or implied by such statements due to a variety of factors, including those risk factors discussed in the company's previously filed annual report on Form 10-K for the year ended December 31, 2024, to be filed with the SEC today. In addition, today's discussion will include operating expenses, excluding cost of goods sold, which is a non-GAAP financial measure. A description of this non-GAAP financial measure and a reconciliation to the closest GAAP financial measure is included in today's press release and the slide presentation available on the IR section of our website at ir.ymabs.com. I would now like to turn the call over to our President and Chief Executive Officer, Mike Rossi.

Mike Rossi (President and CEO)

Thank you, Courtney. Good morning and thank you for joining us. I have with me today our DANYELZA Business Unit Head, Doug Gentilcore, who joined us recently in January, our Radiopharmaceutical Business Unit Head, Natalie Tucker, and our Chief Financial Officer, Pete Pfreundschuh. This morning, I will begin by reviewing key highlights across our business from the fourth quarter and full year 2024. Next, Doug will provide details on our global DANYELZA sales performance and strategy moving forward. Natalie will then provide an overview on the recent updates around our SADA PRIT pre-targeted radiopharmaceutical platform and reiterate expectations around our anticipated GD2 SADA phase I data update planned for the second quarter of this year.

Pete will review our fourth quarter and full year 2024 financial performance, our cash resources, and provide our first quarter and full year 2025 guidance before we open our line for Q&A. Let's begin by looking at our key achievements in 2024. I'm proud of what our team achieved across our business in 2024. We did what we set out to do, and there is more work to be done. DANYELZA has kept a steady share of the anti-GD2 market in the U.S. of between 15-17%. Importantly, we achieved total revenue, inclusive of DANYELZA and net product revenues and license revenues, of $87.7 million for the full year 2024, which is within our stated guidance range of $87-95 million. We continue to face headwinds from competition for patients, including with Naxitamab trials, and DANYELZA's growth continued.

We successfully expanded XUS through several partnerships, and vial demand remains strong. Looking at our radiopharmaceutical platform, we achieved proof of concept with our SADA PRIT platform, as demonstrated by preliminary Part A data from our GD2 SADA phase I trial, trial 1001. We look forward to sharing a more complete data readout anticipated in the second quarter of the year, which will include a number of endpoints and biomarkers that we have previously highlighted. Regarding our CD38-SADA phase I trial, trial 1201, we have activated five sites to date and are actively working to dose our first patient. From a financial standpoint, we ended 2024 with $67.7 million in cash and cash equivalents, which reflects $11.4 million in total annual cash investment for the year below our stated guidance. We anticipate that our cash and cash equivalents will continue to support our current plans into 2027.

Let's now turn to our recently announced business realignment strategy. On January 10th, we announced our strategic decision to establish two distinct business units, DANYELZA and our Radiopharmaceuticals business unit, through which we will manage and operate our business. This is an effort to accelerate the development of our novel SADA PRIT platform and high-value targets program and maximize the potential of DANYELZA. This April will mark our 10-year anniversary since Y-mAbs was founded by Thomas Gad. The company's mission from day one was to bring important new cancer therapies to patients as quickly as possible. The company has done a tremendous job since then of positively impacting countless lives around the world with our leading anti-GD2 therapy, DANYELZA. Through our recently executed realignment, we expect to expand our radiopharmaceutical capabilities, accelerate clinical execution, further improve capital efficiencies, and better align strategic priorities.

With this and other changes undertaken in 2024, the majority of our senior leadership team is now based in the U.S., right here in Princeton, New Jersey. In addition, we are in the process of moving some roles from Denmark to the U.S. to more efficiently coordinate the advancement of our PRIT platform and implementing a small adjustment to DANYELZA's commercial team to focus the team on potential growth opportunities within the anti-GD2 market. Again, I'm proud of our team's achievements in 2024 and thankful for the dedication of each member of our organization to the mission of bringing important new therapies to patients. We remain staunchly committed to advancing a potential new generation of therapies through clinical development aimed at improving outcomes and long-term quality of life for patients and their families.

I will now pass the call over to Doug Gentilcore to provide further color on DANYELZA sales for the fourth quarter of 2024.

Doug Gentilcore (SVP, Head of DANYELZA Business Unit)

Thank you, Mike, and good morning, everyone. I joined Y-mAbs in January as the head of our DANYELZA Business Unit. I have 21 years of experience in biotech, focused predominantly on commercial and strategic operations in radiopharmaceuticals and the pediatric rare disease space. Prior to joining Y-mAbs, I served as Chief Commercial Officer and then CEO of Artemis, which was acquired by Telix Pharmaceuticals. Although I've only been at Y-mAbs for two months, I've seen a level of passion and commitment across our team that is unmatched. I'm thrilled to be leading the DANYELZA Business Unit. As the only approved anti-GD2 therapy for high-risk relapsed refractory neuroblastoma and bone and/or bone marrow, DANYELZA is a differentiated therapy with proven clinical benefits. We believe we have an opportunity to penetrate the U.S.

market even further and increase physician utilization in our current indication while supporting our investigator sponsors on their trials to advance DANYELZA into potential new indications. Let's take a look at some commercial highlights in the fourth quarter of 2024. We are pleased to have achieved our full year total revenue guidance of $87.7 million and DANYELZA net product revenues of $85.2 million. In the fourth quarter of 2024, total DANYELZA net product revenues were $24.5 million, representing a 5% increase compared to the same period in 2023, primarily driven by strong international markets, including the favorable impact of an inventory stocking order in China. While we encountered continued competition in the U.S. from both the launch of a new market entrant for maintenance therapy, as well as ongoing third-party sponsored clinical trial activity, we still saw increases in key performance indicators.

As of December 31, 2024, a total of 69 accounts have ordered DANYELZA around the U.S. since its initial launch in 2021, with 11 accounts added in 2024. DANYELZA's estimated total share of the U.S. anti-GD2 market has remained steady at between 15-17%. Our dedicated team continues to receive positive healthcare provider feedback on DANYELZA through ongoing customer interactions, and we are continuing to build strong relationships with KOLs and key advocates. In the year, we saw continued institutional adoption of DANYELZA, which was added to seven hospital formularies in 2024, bringing the total since initial launch to 48 hospital formularies as of December 31, 2024. The newly realigned business unit structure will allow the DANYELZA team to focus solely on the upper trajectory of the product. The commercial team will focus on promotion and the rightful positioning of DANYELZA.

Along with what we would deem as typical promotional activity, we will further develop meaningful advocacy amongst thought leaders, which is critical to the future of DANYELZA. At the same time, the medical team will prioritize education, new site startup, and produce new and impactful data for DANYELZA. We've already seen the fruits of these efforts, with new sites coming online in 2025, as well as a number of ISS trials that will kick off this year. Now let's turn to our commercial progress outside of the U.S. XUS, our fourth quarter 2024 DANYELZA net product revenues were $7.7 million, an increase of 78% compared to the fourth quarter of 2023.

The increase in international DANYELZA net product revenues was driven by the launch of our named patient program in Western Asia in 2024 and increased net product sales in both Eastern Asia and Latin America, which was partially offset by a decrease in our named patient program in Western Europe. The fourth quarter marked DANYELZA's highest sales in Western Asia, particularly in Turkey with our partner InPharmas, and the third consecutive quarter of DANYELZA sales in Brazil and Mexico, led by our Latin American partner, ADIAM. We expect to see additional adoption over the coming quarters and look forward to providing further updates as we learn about market dynamics in these regions. In China, our partner Cyclone continues to expand use of DANYELZA and is gearing up to launch DANYELZA in Hong Kong following its approval in the region last quarter.

Our sales in the quarter benefited from an inventory stocking order related to the relabeling of DANYELZA in China. I'm excited to be working with this terrific DANYELZA team and energized to advance our goals in 2025 and beyond. DANYELZA is a critical therapy for patients with high-risk relapsed refractory neuroblastoma in the bone and/or bone marrow, and we are committed to further expanding its global reach and advancing into new potential indications. I will now pass the call to Natalie.

Natalie Tucker (Head of the Radiopharmaceutical Business Unit)

Thank you, Doug, and hello, everyone. I joined Y-mAbs in May of 2023 as Vice President of Business Development and Chief of Staff to the CEO before being appointed to our Head of the Radiopharmaceutical Business Unit earlier this year. My background includes extensive pharmaceutical strategy and operational execution experience with specialized experience in radiopharmaceuticals. Previously, I served as Executive Director and Head of Business Planning and Strategy for Novartis' Radioligand Therapy Business Unit and held leadership roles at GuideHealth, a global consultancy where I focused on commercial launch strategies for biotech and pharmaceutical companies. I'm excited to lead the advancement of our innovative pre-targeted theranostic platform and clinical programs. Today, I'll provide a recap of our current SADA PRIT programs and what to expect for our pipeline update in the second quarter of this year.

Let's start with a brief overview and update on our GD2 SADA phase one trial, trial 1001. As a reminder, the primary objective of trial 1001 is to evaluate the safety and tolerability of GD2 SADA in adult patients with solid tumors, including small cell lung cancer, sarcomas, malignant melanomas, and neuroblastoma. In part A, we first explored variable protein doses of 0.3, 1, and 3 nanograms per kilogram and a pre-targeting interval of two to five days. As of February 26th, we've seen seven sites open and dosed a total of 22 patients with both the SADA protein and the diagnostic lutetium payload. Of those 22 patients, nine patients had positive GD2 expression and were eligible for the therapeutic phase of the study to receive up to 200 millicuries of lutetium.

The initial blood pharmacokinetics profile of these patients dosed with the SADA protein appears to match our preclinical models in terms of clearance data, and the blood PK profiles from patients are comparable and supportive of the current dose interval between two and five days. We continue to be encouraged with what we've seen so far. To date, there have been no dose-limiting toxicities and no instances of any treatment-related serious adverse events. Based on the SPECT/CT scans and PK activity we've seen thus far, we believe we've achieved the validity of our SADA PRIT platform, demonstrating that GD2 SADA can both target and bind to tumors and is well tolerated by patients. It is important to note that these early data are still part of an ongoing trial and are not necessarily indicative of the full results or ultimate success of the trial or the SADA development program.

As you saw from our update in January, we expect to present a more complete data set from part A of trial 1001 in the second quarter of this year, including additional scanned images and PK data. Our second SADA PRIT platform, CD38-SADA, is in a phase I trial for the treatment of non-Hodgkin's lymphoma, focusing on B and T cell lymphoma. We've selected the first six sites with five sites activated to date. Two of those sites have been activated since our third quarter update. We plan to accelerate recruitment activity and expect to see the impact of those initiatives in the coming months. Now, let's turn to what we expect from our pipeline update in the second quarter of this year.

In addition to a more complete data set from part A of trial 1001, we expect to present additional platform optimization data that will inform the further advancement of our current programs and new clinical programs going forward. In addition, we plan to present our PRIT pipeline expansion roadmap and timeline. Our team has conducted target selection work in the second half of 2024, evaluating the next potential high-value targets. We started with a database of over 1,200 targets and narrowed that down to between 40-50 fully characterized targets. Key considerations for target selection included disease state characteristics such as unmet need based on a five-year OS of less than 70%, indication size greater than 5,000 annual incidents, and tumors that are known to have radiation sensitivity. Secondly, we looked at target-specific attributes such as cellular location, tumor expression, and healthy tissue expression.

Lastly, we force-ranked these targets to develop a mix of archetypes that we believe will diversify our development risk across novel, high-value targets, high-risk, high-reward targets, well-validated targets, and lastly, proof of concept known targets. In the second quarter of this year, we anticipate unveiling these new print targets for development. I'm excited to be leading the Radiopharmaceutical Business Unit and continuing to work alongside this fantastic team of industry experts. We believe a theranostic pre-targeted approach is a potential game-changing platform in the radiopharmaceutical space with potential beyond oncology. We look forward to providing more details around our future plans during our second quarter pipeline update. Now, let me hand the call over to Pete.

Pete Pfreundschuh (CFO)

Thank you, Natalie, and good morning, everyone. As you heard earlier, we recorded total DANYELZA net product revenues of $24.5 million in the fourth quarter of 2024, representing a 5% increase compared to $23.4 million total DANYELZA net product revenues in the fourth quarter of 2023. This was primarily driven by an increase in international revenues that was partially offset by a decrease in U.S. revenues. U.S. DANYELZA net product revenues were $16.8 million and $19.1 million for the three months ended December 31, 2024 and 2023, respectively, representing a 12% decline. The decline was primarily due to an unfavorable price mix, which was partially offset by a 1% increase in U.S. volume for the fourth quarter 2024 compared to the fourth quarter 2023.

XUS net product revenues were $7.7 million and $4.3 million for the three months ended December 31, 2024 and 2023, respectively, representing a 78% increase. The increase in international DANYELZA net product revenues was driven by named patient program launch in Western Asia and in 2024, an increase in net product sales in Eastern Asia and Latin America. This was primarily offset by a decrease in sales in Western Europe. Our total DANYELZA net product revenues of $85.2 million for the year ended December 31, 2024 were relatively flat compared to net product revenues of $84.3 million for the year ended December 31, 2023. We recorded $2 million of licensing revenue for the three months ended December 31, 2024 from Nobelpharma, and we reported $2.5 million of licensing revenue in the year ended December 31, 2024.

We did not have licensing revenue for the three months ended December 31, 2023, and we reported $0.5 million of licensing revenue for the full year ended December 31, 2023. Research and development expenses were $12.2 million and $13.4 million for the quarter ended December 31, 2024 and 2023, respectively. Our research and development expenses were $49 million for the year ended December 31, 2024, representing a decrease of $5.2 million from $54.2 million for the year ended December 31, 2023. The decrease in research and development expenses was primarily attributable to the recognition of $4.1 million of milestone and licensing acquisition costs related to our SADA licensing agreement during the year ended December 31, 2023. Selling and general administrative expenses increased $1.2 million and $9.8 million to $12.4 million and $54.6 million for the quarter and year ended December 31, 2024, respectively, compared to the same periods in 2023.

The increase in SG&A for the three months ended December 31, 2024 was primarily attributable to a $0.5 million increase in personnel costs, inclusive of stock-based compensation, and a $0.6 million restructuring charge related to personnel and stock-based compensation costs associated with our business realignment. The increase in SG&A for the year ended December 31, 2024 was primarily attributable to a net impact of $3.8 million related to the legal settlements in the year ended December 31, 2024. The increase also includes $1.2 million related to separation and consulting agreements with former executives and a $2.2 million increase in personnel costs associated with stock-based compensation.

We reported a net loss for the fourth quarter ended December 31, 2024 of $6.8 million for a negative $0.15 per basic and diluted share as compared to a net loss of $1 million or negative $0.02 per basic and diluted share for the quarter ended December 31, 2023. In addition, we have reported net loss for the year ended December 31, 2024 of $29.7 million or negative $0.67 per basic and diluted share as compared to a net loss of $21.4 million or a negative $0.49 per basic and diluted share for the year ended December 31, 2023. The increase in net loss for the quarter and year ended December 31, 2024 was primarily driven by an increase in operating expenses and an unfavorable impact from foreign currency transactions, partially offset by an increase in net product revenues.

As mentioned earlier, we ended the fourth quarter of 2024 with cash and cash equivalents of $67.2 million as compared to $78.6 million at the year ended 2023, representing a decrease of $11.4 million. Importantly, we continue to maintain a strong balance sheet reporting $0.9 million cash outflows for the fourth quarter 2024. Turning now to our full year 2025 guidance, we are announcing our anticipated full year 2025 total net revenue to be in a range of between $75 million and $90 million. As a reminder, historically, Y-mAbs has provided total operating expenses, which include cost of goods sold. Consistent with that approach, our anticipated total net operating expenses, including cost of goods, is expected to be between $129 million and $134 million for the full year 2025.

Excluding cost of goods sold, our total net operating expenses is expected to be between $116 million and $121 million for the full year 2025. We expect total annual cash investments for full year 2025 to be in a range of $25 million-$30 million. In addition, we are also announcing guidance for our first quarter 2025 total net revenue, which will be in a range of $18 million-$21 million. As we prepared our guidance for 2025, we noted there is a fair amount of variation in consensus estimates across our guidance numbers. The company is committed to providing guidance numbers that are realistic. With a strong balance sheet and a focused business unit strategy, we believe Y-mAbs is well positioned to execute on our strategic mission and priorities and to support the delivery of multiple anticipated milestones in the year ahead.

This concludes the financial update, and I will now turn the call back over to Mike.

Mike Rossi (President and CEO)

Thank you for that overview, Pete. Let's now open the line for questions. Operator?

Operator (participant)

Thank you. If you'd like to ask a question, please press star 11. If your question has been answered and you'd like to remove yourself from the queue, please press star 11 again. We ask that you please limit yourself to one question and one follow-up. Our first question comes from Alex Stranahan with Bank of America. Your line is open.

Alex Stranahan (Biotechnology Equity Research)

Hey, guys. Thanks for taking our questions. Appreciate all the updates as we start the year here. Maybe first, just on DANYELZA, given the Q1 and full year 2025 revenue guidance, should we be thinking about a roughly flat trajectory for the most part, or could there maybe be some ups and downs to account for seasonal impacts or other factors throughout the year?

Mike Rossi (President and CEO)

Yeah, Alex, thank you for the question. As we look at 2025, we've put our plans in place to accelerate our growth. It's going to take a little bit of ramping up through 2025 as we're supporting some clinical trials and looking for some additional penetration within the high-risk for relapsed refractory neuroblastoma market and also looking for other opportunities to expand the product. I'll turn it over to Pete on the guidance for the quarter as well as the year.

Pete Pfreundschuh (CFO)

Yeah, Alex, appreciate the question. First off, just want to remind everybody that we actually did provide kind of preliminary unaudited numbers at the beginning of this year for 2024. We hit those numbers based upon the revised guidance that we put out last year in Q2 of 2020. Our guidance to be realistic and credible. I think part and parcel to us putting out both full year numbers for this year for 2025, as well as the first quarter numbers, is to make sure that we really guide the street as to some of those effects that you alluded to, like seasonality and some of the stocking effects that we've seen in the past with regards to some of our ex-U.S. partners. To that note, we were very clear. The guidance for the full year is quite wide range. I'll be the first to admit that.

Again, I do not think we want to reset numbers for the full year later this year. I think the way you should think about it is kind of think about the midpoint within that range as you guys model out this year on a full year basis. Separately, for the first quarter, stick within the guidance range that we laid out for you guys, which was that $18-$21 million number on the revenue side of the equation. Obviously, we are two months already into the first quarter. We are seeing already the results of that quarter, so we feel pretty good about that guidance range, and we are going to stick to that. As we move forward in future quarters, it is our intent as a company to provide the next quarter update.

For instance, at the first quarter earnings call, we will provide you guidance with regards to the second quarter, and then we'll also update the full year number, and we're going to narrow the range as we move through the year. Hopefully that's very helpful for you guys as analysts, and it'll also allow us to kind of march to numbers that are achievable for the company as we move down through the year. Hopefully that helps, Alex.

Alex Stranahan (Biotechnology Equity Research)

Yeah, no, that's very helpful. Maybe just one quick one, thinking about the upcoming SADA update, as you're measuring tissue concentration in the upcoming readout, maybe which tissues do you think will be most important outside the tumor from a dose selection perspective? Thank you.

Pete Pfreundschuh (CFO)

Yeah, Alex, I think as we look at this, anytime you look at radiopharmaceuticals, aside from the tumor itself, you're looking at potentially three areas where it would concentrate and remain, one being the kidneys. The renal elimination of products would be an area that you look at as something that could potentially be dose limiting. The second would be hepatic elimination, so what you would have in liver. Finally, if you see additional bone marrow uptake. Bone marrow is another area that you look at for increased concentrations. I think one of the big things too with radiopharmaceuticals as you look at this, as you move into the pet-emitting agents, you could really see all of the places that it goes. You see that with the PSMA product that's out in the market today, where you see additional salivary and lacrimal gland uptake.

Outside of that, I think one of the big keys is not just how much is passing through elimination, but what are the effects of that? You'd look actually at the labs to see if there's any either acute renal injury or chronic. Same thing, you start looking at liver enzymes to determine if you're actually having an impact. Because systemic radiotherapy at these relatively small doses compared to external beam has different impacts on the body. It's really, are you seeing injury from it versus just concentration?

Alex Stranahan (Biotechnology Equity Research)

Got it. Thanks for the questions.

Pete Pfreundschuh (CFO)

Appreciate it, Alex.

Operator (participant)

Thank you. Our next question comes from Mike Oles with Morgan Stanley. Your line is open.

Mike Oles (Analyst)

Good morning and thanks for taking the question. Maybe just another sort of guidance question, particularly on OpEx. You're guiding to $116 million-$121 million this year. Just wondering if you can give us the breakdown between R&D and SG&A. As we move forward into sort of the outer years, as you start to ramp the SADA program, how should we think about R&D evolving there? Thanks.

Mike Rossi (President and CEO)

Yeah, Mike, I appreciate it. As we look at this, there'll be a couple of things. I'll turn it over to Pete for some of the breakdowns. As we think about our investment, that's also into our planning for our cash runway. As we look in at bringing additional targets in, there'll be some costs coming out of DANYELZA on our 201 study as that's coming to a completion, which was our post-marketing commitment. We also have additional targets coming in to R&D from a SADA perspective. We've also optimized that system, and we're treating it a little bit differently on how we bring targets into our phase, our preclinical and phase one that has been done in the past.

We will be sharing that process in second quarter on how we plan to decrease the cost to get these targets into clinic and how many targets we can actually bring forward. I'll send it over to Pete for what our actual spend is and breakdown.

Pete Pfreundschuh (CFO)

Sure. Thanks, Mike. Mike, good question. Just to clarify, the 116-121 is our OPEX guidance number without cost of goods. Just as a reminder for everybody on the line, in the past, we've provided OPEX guidance historically as a company, including cost of goods sold. Again, as a reminder, we said on today's call that including cost of goods, that number is more like 129-134. Coming back to the 116-121 without cost of goods, the way I would think about the breakdown of that, Mike, and we don't provide specific detail of the breakdown, is think about our SG&A kind of cost for 2024 as reported. That number was about $54-55 million.

Remember, in that number, there was about $9 million of some one-time charges in there related to some legal settlements as well as a number of other kind of things. That was disclosed as part of our overall number. We do not anticipate some of those one-time items reoccurring in 2025. I would presume take the $55 million minus the $9 million. That is a base. That base will grow a little bit, but not a lot. The rest is kind of R&D. That is kind of the way I would suggest you think about it as you model your numbers. Hopefully that helps, Mike.

Mike Oles (Analyst)

Very helpful. Thank you.

Pete Pfreundschuh (CFO)

Yep.

Operator (participant)

Thank you. Our next question comes from Jeff Jones with Oppenheimer. Your line is open.

Jeff Jones (Senior Analyst)

Good morning, guys. Thanks for taking the question. As we think about the shift in R&D spend over time away from DANYELZA, can you speak a little bit to how you're thinking about the investigator-sponsored studies and investment you are making in DANYELZA and how we could look at that impacting revenue looking forward, say, beyond the 2025 guidance?

Mike Rossi (President and CEO)

Yeah, Jeff, I appreciate the question. I think one of the things as we look at DANYELZA, currently our highest cost associated with the R&D with DANYELZA is on completing our 201 trial, so the post-marketing commitment. When we look at investigator-sponsored trials, we are continuing to invest in those, which would lead to increased penetration within the segment as well as additional indications. We'll continue to support that. It does create some short-term competition for patients. However, I think long-term will provide some additional tailwind. We're also developing a diagnostic to better select for GD2. With that, as we move forward and have a better way to select, it'll open up the opportunity again to look at potential registration trials for expanded indications on the product.

We know one of the challenges with GD2 as we look at things like osteosarcoma are actually being able to patient select for GD2. The closer we get to that, the more opportunity it gives us to get into some additional investment in trials, both in ISS as well as potential registration trial.

Jeff Jones (Senior Analyst)

I appreciate that, Mike. Just one follow-up on the CD38 program. You noted that those trial sites have been open for a while, but you're still working to enroll the first patient. Just any color there on the challenges enrolling that study and how that might, if that is related to the SADA program or the target or something else?

Mike Rossi (President and CEO)

Yeah, no, I appreciate that. It's taken a while to get these five sites up and running. We had one up and running in third quarter, and then we've brought the rest of them on since. I'll say it is a very difficult segment to enroll patients. I think that's been our biggest challenge. We've identified patients, but through the qualification process, either they didn't qualify for the trial or they weren't healthy enough because it was very much end-stage. It is a very difficult segment, unrelated to SADA, more related to the refractory non-Hodgkin's patients that have been the challenge.

Jeff Jones (Senior Analyst)

Okay. Appreciate it, guys. Thank you.

Operator (participant)

Thank you. Our next question comes from Nicole Germino with Truist. Your line is open.

Nicole Germino (Analyst)

Good morning and thanks for taking my question. Just a quick question on the bridging study. Does the bridge to 1001 Part B push up a start to advancing of Part B? Can you remind us again what the timelines and expectations are for Part B and C?

Mike Rossi (President and CEO)

Sure, Nicole. I appreciate the question. I'm going to turn it over to Natalie, who could speak a little bit to what the bridging study is, why, and kind of what the timelines are for that.

Natalie Tucker (Head of the Radiopharmaceutical Business Unit)

Thanks, Mike, and thanks, Nicole. Just regarding the bridging study back to 1001 Part B, we anticipate kicking that off in early 2026. We think it'll be quite quick, especially compared to the Part A of the study, because we are enrolling a fewer number of patients, and we're really just testing that molecule optimization and the work that's currently ongoing. We will be reporting on that in Q2 and our plans to go back into Part B in our Q2 data readout with the full targeting plan and strategy going forward. All in all, it will be what we believe a relatively quick bridge to bring us back into the Part B dose escalation phase.

Nicole Germino (Analyst)

Great. Also, on that second part of the question, can you remind us about the timelines and expectations for Part B and C?

Natalie Tucker (Head of the Radiopharmaceutical Business Unit)

Yeah. I mean, Part B is anticipated 12 patients relative to the 24, 23, excuse me, that were consented for the Part A. The timeline on that, we'd expect to be quite a bit quicker, roughly. I mean, let's just go with quite a bit quicker, including the fact that we will have and we anticipate having PET-directed patient selection. Part B, in terms of the timeline, will be relatively quick to Part A. Part C, we will announce once we see a little bit more data in the Part B and we go back to FDA on detailed timelines. Compared to Part A, it will be relatively quick.

Nicole Germino (Analyst)

Okay, great. Thank you so much.

Natalie Tucker (Head of the Radiopharmaceutical Business Unit)

Thanks, Nicole.

Mike Rossi (President and CEO)

Thanks, Nicole.

Operator (participant)

Thank you. Our next question comes from Lee Wacek with Cantor Fitzgerald. Your line is open.

Lee Wacek (Analyst)

Hey, good morning. Thanks for taking the question. I guess for GD2, the main steps for you to select the protein dose from the Part A. I'm just curious for the non-GD2 positive patients, whether each patient received more than one dose of the therapeutic location.

Pete Pfreundschuh (CFO)

I appreciate it, Lee. All nine of those patients that showed uptake did receive a therapeutic level follow-up dose, and that was per the protocol. When we evaluated those, only those patients that showed significant uptake as part of that diagnostic received the therapeutic. It is limited in the amount of information around the protein dose itself, but we feel confident in the work we're doing currently that we'll be able to narrow it down to what we think is an optimal protein dose as we move forward into advancing the trial.

Lee Wacek (Analyst)

Okay. You also mentioned that you'll be looking at, I guess, a number of different SADA targets. Just curious what your BD strategy might be, I guess, for some of them, given it might not be realistic to develop all of them.

Pete Pfreundschuh (CFO)

Yeah, no, that's a good question. As we looked at these targets, and we started with over 1,200 targets, we narrowed them down to the top 40 or 50 that we think would be optimal for the radiomune therapy platform. With that, we also identified three franchise areas in which we would be interested in bringing those targets to commercialization ourselves. Several of those targets fall outside of those three franchises. From an efficiency point of view, they would be more ideal targets to partner with or outlicense, while the targets that we're looking to bring forward within our franchises would be the ones we would keep in-house. We're open to BD opportunities. There's also the opportunity if an external partner wanted to bring their target forward to us and for a potential partnership, we would be willing to have that discussion as well.

Our commercialization strategy would be focused within our franchises, and that'll be part of our second quarter update.

Lee Wacek (Analyst)

Okay, thank you.

Operator (participant)

Thank you. Our next question comes from Bill Maugin with Clear Street. Your line is open.

Bill Maugin (Analyst)

Good morning and thanks. Looking at 2025 DANYELZA guidance and the references to an increasingly competitive, well, competitive dynamic for DANYELZA, could you help sort of bring to life what that evolving competitive dynamic looks like and kind of discuss that in context of how we should be looking at long-term DANYELZA growth? Thank you.

Mike Rossi (President and CEO)

Sure, absolutely. As we look at this, one of the things we look at overall is the competition for the patients, right? Ultimately, there are several areas in which you compete for patients, and that is competitive therapies, that is other products that have come to market, as well as clinical trials. That really falls into the overall competitive dynamics for the product. Doug has a plan to move forward on how to, A, leverage those clinical trials to make sure we're gaining experience out in the market and increasing market share and penetration. We continue to invest. Our goal is to bring it to as many patients as possible. We're very confident in the product. Doug, do you want to add some color to that?

Doug Gentilcore (SVP, Head of DANYELZA Business Unit)

Yeah. Most of the impact in the near term is transient, meaning that we're competing for some study doses, but that is really laying the groundwork for what's going to come in the future. The good news from a market standpoint, above and beyond those trial doses and competing for patients, as Mike mentioned, there's plenty of market to move, and we're seeing that happen already early in 2025 with new patient starts. We have extremely positive feedback from the lead investigator for the ISS, but also the market as a whole.

Pete Pfreundschuh (CFO)

Bill, as we go forward, we look at the opportunity to expand the outpatient option for parents and for children that are being treated. With DANYELZA having the only indication in bone and bone marrow involvement as well as outpatient, it gives us a lot of opportunity to increase the experience at institutions and increase the outpatient option for parents.

Bill Maugin (Analyst)

Got it. Thank you.

Mike Rossi (President and CEO)

Thanks, Bill.

Operator (participant)

Thank you. Our next question comes from Justin Walsh with Jones Trading. Your line is open.

Justin Walsh (Equity Research Analyst)

Hi, thanks for taking the question. Now that you're moving forward in the clinic with CD38-SADA, it would be great if you could discuss the unmet need there and what level of benefit patients would ultimately need to see for the asset to prove clinically useful and commercially viable.

Mike Rossi (President and CEO)

Yes, Justin, I appreciate it. Coming forward with the CD38, I'll say that the decision was made a few years ago to bring that forward based on internal knowledge of the CD38 target with the work some of the team members had done in the past to bring an antibody to market. For us, there is an unmet need in non-Hodgkin's, but again, it's a very competitive space. Part of bringing CD38 forward was to validate a second target that we can get into clinic rather quickly, which the team was able to do. Patient selecting is much more difficult, but also looking at validating this in a circulating tumor versus just a solid tumor was an opportunity to get an end of two. Two different targets and start comparing some of the data that we're seeing.

Time will tell as this develops on how long or how much effort we could give it, but that'll be up to Natalie and the team as we look forward to our Q2 update on what the targets are.

Justin Walsh (Equity Research Analyst)

Got it. Thanks for taking the question.

Mike Rossi (President and CEO)

Appreciate it, Justin.

Natalie Tucker (Head of the Radiopharmaceutical Business Unit)

Thank you. Our next question comes from Robert Burns with HC Wainwright. Your line is open.

Robert Burns (Managing Director - Biotech Equity Research)

Hey, guys. Thanks for taking my questions. We're really looking forward to the update coming in Q2. Just two questions from me, if I may. I guess around the first one, could you provide a little more granular color around the market dynamics in neuroblastoma, especially with the FDA approval of DFMO in late 2023, and how that could potentially be impacting DANYELZA sales? The second question is just around the COGS. Obviously, the COGS were significantly higher this quarter, so just some color around that.

Mike Rossi (President and CEO)

Yeah. I'll start with the entrance of DFMO. When you look at an inhibitor coming into the market, there's always an opportunity for patients to try out a new therapy. We know with inhibitors, it's rate-limiting to how long they'll be on them. Once the patient begins to advance, they'll need to go back to a more aggressive therapy because, again, inhibitors tend to be a temporary solution. For us, it's always positive when a child can maintain response as long as possible. As the patients begin to come off of that, they'll need to come back to an anti-GD2 therapy in order to be treated. I think some of that is an additional headwind that'll return to a little bit of an equilibrium. Again, there's options for patients. There's options for parents.

As we move forward, you hope that the best options are what's helping the patient maintain a complete response to prevent the disease from recurring. From a cost of goods perspective, there are ebbs and flows in that. As we look at bringing product in, there will be batch costs that come in at different points in time. What you'll see is an increase as we're doing a certain number of batches, whether it's a DANYELZA cost of goods, or whether it's a SADA. I could turn it over to Pete for a little bit of additional color on what drives those cost of goods fluctuations. This is a low-volume, high-value product. You will see, similar to stock in the ex-U.S. market, buy-ins from us as we're getting in from our partners.

Pete Pfreundschuh (CFO)

Yeah, Mike, it's spot on. You can take a look at the fourth quarter results numbers. The XUS component was quite strong. A component of that is obviously continued stock ins and other elements associated with that. That is what drives kind of that COGS component. In addition to that, in the fourth quarter, we did have some inventory write-offs, but that was a minor component of that. We really have not had a history of kind of write-offs in the past. Of course, all those things factor into some of those numbers, but hopefully that helps.

Robert Burns (Managing Director - Biotech Equity Research)

Yeah, it certainly does. Thank you for that.

Mike Rossi (President and CEO)

Great. Thank you, Robert.

Operator (participant)

Thank you. Our next question comes from Kemp Doliver with Brookline Capital Markets. Your line is open.

Kemp Dolliver (Director of Research and Senior Analyst)

Great. Thank you for allowing the question. With regard to the guidance range, can you speak to the dynamics with regard to patients recycling back from DFMO? Also, is there any change in the payer mix that we've seen the last two quarters that's going to carry through, particularly in the first half? Also, what WAC, because it looks like at least with your main competitor, Unituxin, they've become very aggressive with increases in WAC. Thank you.

Mike Rossi (President and CEO)

Yeah, Kemp, I appreciate it. Just a few things. As we start looking at this, we look at the overall patient population availability, and we build our models accordingly. With those that may be cycling on and off of another therapy, we factor those in. We also factor in the residence time that they would be on our therapy versus a competitive therapy. I'll let Pete speak a little bit more to the payer mix as well as WAC and what that looks like overall. We really do not speak to the competitive products on what they do, but we can really speak to what we have done and how we see our product.

Pete Pfreundschuh (CFO)

Yeah, Kemp. First off, from a WAC perspective, pricing perspective, and this is public data, we took a 7% price increase this year. Our competitors tend to take a much higher price increase. I'll just leave it at that. I'm not going to get into details on that. You can go out and take a look at what those numbers are. We obviously do a very thorough analysis as to where our base price is with those price increases, what the implication is relative to our payer mix, which I think was your other question, because obviously there's a component of payer mix that includes Medicaid as well as 340B, as well as non-Medicaid, non-340B, and that all folds into those elements.

When we look at price increases, we do that work with an external third-party service provider just to make sure that we do not overstep price increases and then end up in a situation where we have further give-backs on the other side of the equation. I think with regards to the mix, the mix has continued to move more towards Medicaid institutions in terms of sales as we have kind of moved through the last five quarters, year and a half, two years. As we have kind of migrated in that direction, of course, that has had some impact with regards to overall gross margin to the business. We see stabilization at this juncture, most probably as we move forward. We did have a slight increase in this quarter. Over last quarter, we had an increase, as you know.

I think as we move forward in 2025, we're most probably at that kind of peak point where we should see stabilization in that number. Hopefully that helps, Kemp, on both fronts.

Kemp Dolliver (Director of Research and Senior Analyst)

Yeah, that's great. Thank you. My second question relates to your efforts to engage with COG sites. If you could just give a little more detail behind that.

Pete Pfreundschuh (CFO)

Yeah, Kemp, I appreciate it. When we look at this, we know the competitive product was brought to the market through COG. It has taken a little bit—well, it has taken a lot of effort to penetrate those COG sites and bring the benefits of DANYELZA forward. We have clinical trials, both ongoing as well as scheduled, to kick off with some leading COG sites as they look at giving DANYELZA as an option across multiple sites. For us, we're still focused on their top 10-15 sites to continue to penetrate and increase penetration, as well as provide that outpatient option. We're working very closely with the key opinion leaders there. We are known as a company focused on GD2, and we have very good relationships and continue to build those, as well as build experience within the COG sites.

Operator (participant)

Thank you. There are no further questions at this time. I will now hand the call back to Mike Rossi for closing remarks.

Mike Rossi (President and CEO)

Thank you, Operator. Thank you, everyone, for joining us today to discuss our fourth quarter and full year 2024 results and our continued progress. We believe Y-mAbs is well-positioned to execute and achieve strong strategic priorities across our DANYELZA and radiopharmaceutical business units in 2025 and beyond. We look forward to providing further updates during our radiopharmaceutical pipeline update and GD2-SADA phase I, part A data readout planned for the second quarter. Thank you all and have a great day.

Natalie Tucker (Head of the Radiopharmaceutical Business Unit)

Thank you for your participation. This does conclude the program. You may now disconnect.