Blueprint Medicines Corp (BPMC) 2017 Q2 法說會逐字稿

Good morning. My name is James and I'll be your conference operator today. At this time I'd like to welcome everyone to the 2017 Second Quarter Blueprint Medicines Corporate Earnings Conference Call. (Operator Instructions) Thank you. Kristin Hodous, you may begin your conference.

Thank you, Operator. Good morning. This is Kristin Hodous of Blueprint Medicines and welcome to Blueprint Medicines' Second Quarter 2017 Financial and Operating Results Conference Call. This morning we issued a press release which outlines the topics that we plan to discuss today. The release is available in the Investor Section of our website at www.blueprintmedicines.com.

Today on our call, Jeff Albers, Chief Executive Officer, will discuss Blueprint Medicines' second quarter 2017 business highlights; Andy Boral, Chief Medical Officer, will review our clinical updates; and Mike Landsittel, Vice President of Finance, will review our second quarter financial results. We will then open the call for your questions.

Before we get started, I would like to remind everyone that statements we make on this conference call will include forward-looking statements. Actual events or results could differ materially from those expressed or implied by any forward-looking statements as a result of various risks, uncertainties, and other factors including those set forth in the Risk Factors section of our most recent Quarterly Report on Form 10-Q filed with the SEC and any other filings that we may make with the SEC.

In addition, any forward-looking statements made on this call represent our views only as of today, and should not be relied upon as representing our views as of any subsequent date. We specifically disclaim any obligation to update or revise any forward-looking statements.

Now, here's our CEO, Jeff Albers.

Thanks, Kristin, and good morning everyone. Blueprint Medicines had a very productive second quarter and we're pleased to share recent progress with you today.

We spent the last several years building a pipeline of highly targeted kinase medicines for patients with genomically-defined diseases, with the goal of bringing into the clinic highly selective and potent drug candidates with less off-target activity and a higher probability of clinical success.

Through these efforts, we generated promising early clinical data for our BLU-285 and BLU-554 programs. We received breakthrough therapy designation and FDA feedback for BLU-285 and PDGFRalpha-driven gastrointestinal stromal tumors, or GISTs. And we recently initiated a clinical trial of our innovative RET inhibitor, BLU-667, in RET-altered cancers.

Today, our line of sight extends toward potentially delivering an important new medicine to patients with advanced GIST and becoming a commercial-stage company. We think this is a tremendous achievement for a company that began operations only six years ago.

I often tell our employees that success simply gives us the right and responsibility to do more and work harder, and that's exactly what we're doing as we enter the second half of 2017.

Earlier this year, we laid out our key goals for 2017. These included, one, advancing BLU-285 and BLU-554 clinical trials towards critical data disclosures; two, defining the clinical and regulatory paths forward for these drug candidates; three, maximizing the value of our broad research platform; and four, evaluating strategic business development opportunities.

At mid-year, I'm proud of the progress we've achieved and feel very good about our momentum going forward. At the ASCO Annual Meeting in June, we presented updated data from our ongoing Phase 1 trial of BLU-285 in patients with advanced GIST. The results demonstrated compelling clinical activity in two distinct patient populations. Patients with PDGFRalpha-driven GIST and patients with KIT-driven GIST. And today, we announced that our second clinical data disclosure will come on September 10 at the 2017 ESMO Congress, where we'll present updated data from our ongoing Phase 1 trial of BLU-554 in patients with advanced hepatocellular carcinoma, or HCC.

We also announced today that we initiated enrollment in the expansion portion of our Phase 1 clinical trial, evaluating BLU-285 in patients with advanced systemic mastocytosis. We expect to disclose updated data from this trial by year-end, continuing a cadence of data readouts from our ongoing clinical program.

Following a successful end-of-Phase 1 meeting with FDA earlier this year, we were pleased to receive favorable agency feedback on our proposed registration plan for BLU-285 and advanced GIST. Similarly, we plan to engage regulatory authorities on a range of options for further development of BLU-285 and systemic mastocytosis and BLU-554 and HCC in the second half of 2017 and into 2018

Across all of our programs, we aim to define clinical and regulatory strategies to bring new medicines to patients as quickly as possible based on clinical data, feedback from regulatory authorities, and input from clinical experts.

With respect to our research programs, we continue to maximize the value of our scientific platform. As I mentioned, earlier this year we advanced our third drug candidate, BLU-667, into the clinic. In addition, we continue to advance a range of preclinical programs, both in collaboration with Roche and on our own.

As you know, last week, Alexion notified us of their decision to exit our research collaboration following a strategic portfolio review. Alexion indicated that their decision was solely based on a refocusing of their R&D strategy on certain core therapeutic areas. As a result, we have an interesting and unexpected opportunity ahead of us.

Under the collaboration, we were evaluating multiple compounds in preclinical development for the treatment of fibrodysplasia ossificans progressive, or FOP. FOP is a severe, ultra-rare disorder of the connective tissue characterized by the abnormal transformation of skeletal muscles, ligaments, and tendons in the bones. Our research is focused on inhibition of mutated forms of the L2 kinase, which is believed to be the underlying cause of the disease.

Moving forward, we plan to explore opportunities to advance the FOP program on our own based on the extensive discovery and preclinical work completed to date. We also feel an obligation to the FOP patient community to take a very close look at potential option for this program.

A first step in this process will be to coordinate an orderly transition of the program with Alexion over the coming months. As we evaluate opportunity to advance the FOP program, we'll stay disciplined in managing our overall clinical and research portfolio. Across our pipeline, we consistently focus on opportunities to transform patient care and pursue expedited development paths.

We also recognize strategic business development plays an important role in disciplined portfolio management, and we continue to evaluate potential partnership opportunities that may allow us to accelerate our programs or expand our global reach.

Overall, we're extremely pleased with our year-to-date accomplishments and look forward to a busy and productive second half of 2017. With that, I'll now turn the call over to Andy Boral to update you on the progress of the clinical trial.

Thanks, Jeff. We're very excited by our clinical progress and encouraged by the results that continue to emerge from our trials. This morning, I'll briefly review each of our clinical programs, including recent progress.

First, we're really pleased to have compelling clinical data and a clear path forward for our KIT and PDGFR-alpha inhibitor, BLU-285, in advanced GIST. At the ASCO Annual Meeting in June, we presented new clinical data from the ongoing Phase 1 trial of BLU-285 in two patient populations -- patients with PDGFR-alpha D842-driven GIST and patients with KIT-driven GIST.

Across both populations, BLU-285 continues to be well tolerated with Grade 3 or worse adverse events thought to be treatment-related observed in only 25 percent of patients. The clinical activity in patients with PDGFR-alpha D842-driven GIST were remarkable. The data showed an objective response rate of about 60% by RECIST criteria, and in 9 months, median progression pre-survival of 87%.

Based on these very encouraging data, the FDA granted breakthrough therapy designation to BLU-285 for the treatment of unresectable or metastatic PDGFR-alpha D842V-driven GIST.

Moving forward, we plan to pursue an expedited approval in this population based on additional data from the Phase 1 trial. We currently expect to complete enrollment of the PDGFR-alpha D842V expansion cohort by the middle of 2018.

In patients with heavily pretreated KIT-driven GIST, the clinical data showed very encouraging dose-dependent activity, with tumor aggression and prolonged progression of presurvival in patients treated with the higher doses of BLU-285.

This is in a clinical setting where few patients respond and the expected progression-free survival of available therapies is less than two months. To advance development of BLU-285 in this population, we plan to initiate a global randomized Phase 3 trial of BLU-285 compared to regorafenib in third-line GIST in the first half of 2018.

Overall, this dual approach gives us the opportunity to quickly address an important unmet medical need in PDGFR-alpha D842V-driven GIST, while also pursuing approval in a broad GIST population. We are planning additional regulatory meetings with FDA and UHealth authorities over the course of this year to continue to refine the regulatory path for BLU-285 in GIST.

We're also evaluating BLU-285 in advanced systemic mastocytosis. Preliminary Phase 1 data for BLU-285 in SM were presented at the ASH Meeting last December and showed marked decreases in objective measures of mast cell burden and serum tryptase, as well as improvements in patient symptoms from the lowest dose levels tested.

These data demonstrated that targeting the KIT D816V genetic driver with a highly potent and selective inhibitor like BLU-285 has potential to address not only the symptoms of the disease, but also the underlying cause.

We're happy to announce today that we recently initiated the dose expansion part of the trial and are enrolling patients at the recommended part-2 dose of 300 milligrams once daily. Based on the activity of BLU-285 in advanced SM, even at the lowest dose levels and feedback from our clinical advisors, we also see an important opportunity for BLU-285 in patients with indolent systemic mastocytosis.

Indolent SM is a nonmalignant mast cell disease where patients have normal life expectancy but a plethora of debilitating symptoms. We're working closely with our clinical advisors to outline a path forward for BLU-285 in this patient population.

Later this year, we plan to share additional data from our ongoing trial of BLU-285 in advanced SM, including advanced assessment of response rate using the IWG criteria, which is now recognized as a valid regulatory endpoint with the recent approval of (inaudible).

Our second product candidate, BLU-554, is in development as a potential treatment for patients of advanced HCC. As you all know, treatment options for HCC are limited, and the prognosis for patients is generally very poor. The only approved therapies for HCC are sorafenib and regorafenib, which provide overall response rates of 2% and 7% respectively.

Approximately 30% of HCC cases are thought to be driven by FGFR4 pathway activation. To target this disease driver and avoid off-target effect associated with other members of the FGFR family, we designed BLU-554, an exquisitely selective FGFR4 inhibitor. This approach represents the first biomarker-directed treatment strategy in HCC.

Last November at the triple meeting, we presented early clinical data that demonstrated anti-tumor activity for BLU-554 in biomarker-positive patients. Based on these data, we increased the size of biomarker-positive expansion cohorts in the ongoing Phase 1 trial.

At the upcoming ESMO 2017 Congress, we plan to present updated data from the dose escalation part of the Phase 1 trial, as well as expansion data for patients with sufficient follow-up. Our ESMO abstract included results of a data cutoff of April 20, 2017, and consistent with prior presentations, we'll present more recent results at ESMO.

In the ESMO data set, we expect to have additional information to help determine if our patient selection strategy for FGFR4 pathway activation is effective, and to better understand the clinical activity of BLU-554 in this very severe, rapidly progressive disease.

Finally, we continue to make good progress advancing our third product candidate, BLU-667, in the clinic. BLU-667 was specifically designed to selectively inhibit RET mutations and fusions, including predicted resistance mutations, with the goal of providing more durable clinical benefit to patients with RET-altered cancers.

Earlier this year, we initiated a Phase 1 trial of BLU-667 in patients with non-small cell lung cancer, medullary thyroid cancer, and other advanced solid tumors harboring a RET alteration. In the second quarter, we offered additional clinical sites to expand enrollment of patients in the dose escalation part of the trial.

Overall, we're pleased with our progress to date and the enthusiasm of investigators and patients to participate in the trial. We anticipate providing more robust updates on this clinical trial in the first half of 2018.

As you can see, we're all staying very busy here at Blueprint Medicines, and we look forward to updating you on the progress across all of our clinical trials in the future.

With that, I'll turn the call over to Mike to review our financial results for the second quarter. Mike?

Thanks, Andy. Today, we are in a strong financial position to support the significant activities that Jeff and Andy just outlined. Let me start by walking you through the second quarter P&L.

Collaboration revenues were $5.9 million for the second quarter of 2017, compared to $7.1 million for the same period in 2016. This decrease was primarily due to lower revenue recognized under our collaboration with Alexion.

As a result of the discontinuation of our collaboration with Alexion, we won't be entitled to receive any additional milestone payments, and upon effectiveness of the termination of the agreement, we'll no longer be entitled to reimbursement by Alexion for certain R&D expenses related to the program.

Research and development expenses were $33.3 million for the second quarter of 2017, compared to $21.3 million for the same period last year. The increase in R&D spending was primarily attributable to increased clinical and manufacturing expenses associated with the ongoing trials for BLU-285, BLU-554, and BLU-667, as well as increased personnel-related expenses, including stock-based compensation expense.

General and administrative expenses were $6.8 million for the second quarter of 2017, compared to $4.7 million for the second quarter of 2016. The increase in G&A spending is primarily due to increased personnel-related expenses, which include stock-based compensation expense.

Net loss for the second quarter of 2017 was $33.4 million, or $0.86 per share, compared to a net loss of $18.9 million, or $0.70 per share, for the same period last year.

Now, turning to the balance sheet in our cash guidance, we ended the quarter with cash, cash equivalents, and investments totaling $421 million, compared to $268.2 million as of December 31, 2016. The increase in cash was primarily due to the net proceeds of $215.6 million from our follow-on offering that closed in April 2017, offset by cash used to fund operations.

Based on our current plans, we continue to expect that our existing cash, cash equivalents, and investments, excluding any potential option fees and milestone payments under our existing collaboration with Roche, will enable us to fund operating expenses and capital expenditure requirements into the second half of 2019.

As Jeff mentioned earlier on the call, our plans also include evaluating opportunities to advance the preclinical program that was the subject of our collaboration with Alexion.

Importantly, now that we have defined a regulatory path for BLU-285 in advanced GIST, we are beginning to ramp up clinical development and early pre-commercial activity. For example, we are beginning to build infrastructure to support the planned global Phase 3 trial in third-line GIST and expand CMC activities to provide clinical and commercial drug supply, including commercial validation batches for BLU-285. Longer-term commercial planning is underway, and we expect to provide further clarity on expected operating expenses in the future.

With that, we would now like to open up the call for your questions. Operator?

(Operator Instructions) Your first question comes from the line of Terence Flynn from Goldman Sachs.

Hi, thanks for taking the question and congrats on progress this year. I was just wondering what you guys are hoping to see from the 554 Phase 1 expansion trial here to move into the Phase 3 program. Is it really just a better response rate, given you laid out the 2% to 7% with prior drugs, or is it something with respect to durability? Maybe you could just help frame for us how to think about that decision to move into Phase 3. Thanks a lot.

So as I said at the beginning when I was presenting, the outcome of these patients is very poor with available therapies. As I mentioned, just a -- less than 10% response rates with both sorafenib and the other approved therapy, regorafenib, and very short progression-free survivals.

What we're really looking for in this study are two things primarily. One is to fully understand how to best select the patient population. So we are selecting the patients for FGFR4 pathway activation with our immunohistochemistry test for FGF19. And we think a very important part of this study will be to evaluate activity, primarily response and tumor shrinkage according to degree, of FGF19 positivity, but we're also interested in looking at degree of prior therapies. The patients in our study have had multiple prior therapies, often. Geographies, etiology. And so, that's one important piece, is for the next study, how would we select those patients to optimize activity.

And the second, of course, is to understand the degree of activity, and in this study that would be mostly measured by tumor shrinkage and response. And as we pull all those data together, we'll make a decision on the best next step for our development.

Your next question comes from the line of Eric Schmidt from Cowen & Company.

Congrats on the steady progress. Maybe another question from me for Andy on BLU-554 and HCC. In terms of the number of patients, maybe give us a little bit of color there. But are we also going to get all three dose expansion cohorts and are all three kind of nearing full enrollment at 45 patients each?

I assume you're talking about the ESMO presentation. There, the abstract, which will come out, I think it's August 30 you'll get much more information there, and the presentation will include data on essentially the entire dose escalation part of the study, and then the dose expansion part for patients who we have sufficient follow-up on. So it will be a subset of the expansion part of the patients.

The study is enrolling well, but a lot of those patients have come on relatively recently, and so that would limit the amount of data from expansion.

And at the time of ESMO, will you guys be in position to kind of give us an update on your development plans for the molecule?

Our focus really, as I said before, is going to be on understanding and describing the effectiveness of the patient selection process, seeing if there are correlations with other predictors of response, and then summarizing the data. At this point, I think it may be premature to lay out the development program at that time. And we do look forward to having more data from that program over the course of the year before we're ready to get into the development plan in detail.

Okay. And then maybe just a quick one on the RET inhibitor. What's your best guess of when we'll see the first clinical data there?

So we're expecting to -- well, so maybe I'll start just by saying the study is ongoing, enrolling well. The investigators have been enthusiastic. Our plan, though, is to present data in the first half of next year at this point. We'd like to have a good story to tell at the time that we present the data.

Your next question comes from the line of Chris Raymond from Raymond James.

Just a question on the BLU-285 and your dosing in GIST. I think the last I heard you guys talk about dose at ASCO, you mentioned the sweet spots between 300 milligrams and 400 milligrams, with 400 being the MTD. But I don't know that you guys have said that you really hit on a dose, but with the KIT Phase 3 starting in the first half of, I think you said next year, and you're obviously also going for it with the expansion cohort for PDGFRalpha, can you talk about that in terms of hitting on a dose and maybe how those conversations with FDA are going?

So we did define the MTD of BLU-285 in GIST as 400 milligrams a day. You know, something that we think is a great opportunity for this program where we have a relatively large expansion experience revolving in GIST and 285 with both our KIT-driven population and our PDGFRalpha-driven patient population -- they'll each be 50 patients -- as well as the ongoing systemic mastocytosis study, is that we have an opportunity really explore dose a bit and figure out what is the best dose to start off, and that will also support long-term therapy with a good balance of maximizing activity and maintaining a good safety profile.

So the MTD is 400 milligrams, and we're exploring anywhere between 300 milligrams and 400 milligrams. We have decided in the mastocytosis study to proceed with a dose of 300 milligrams, because after reviewing all the data, that seemed to give us the best balance of activity and long-term tolerability. We very well may end up at the same dose in GIST, 300 milligrams with the option to explore 400 milligrams in the future.

So you might have like a titration protocol. I guess that's what --

Yeah, so one thing -- an approach that (inaudible) has taken that I think has been pretty successful is to start, if you look at the label, that you start at 400 milligrams. If patients tolerate, you can actually escalate to 600 milligrams, even to 800 milligrams. And I think that kind of flexibility has turned out to be very effective. And so, we're considering something along those lines. But the maximum tolerated dose would be 400 milligrams, and the question is, where in the range of 300 milligrams to 400 milligrams do we start, and do we allow interpatient escalation.

Okay. And then on the FOP molecule that you got back from Alexion, just maybe talk a little bit about your appetite. I know you're taking this forward alone, but you have another competitor there with Regeneron starting efforts with their own approach, so you'll at least have another player trying to recruit patients, et cetera, which is always, from a competitive standpoint, a challenge. Just maybe talk about your thoughts there. Do you need to re-partner this, or from your lay of the land is this something that can easily be done internally?

Maybe I'll start and then I'll ask Marion Dorsch, our Chief Scientific Officer, to talk a little bit about the mechanism. So I think it's a great question. We were surprised to have Alexion step away from the collaboration, given the nice progress. And so, our first order of business is just to ensure a smooth transition of all the information that we've collected today preclinically, as well as the work that's been done within Alexion. So I think that's, regardless of what we think more broadly, where our focus is now.

And then, as I alluded to, from a portfolio perspective, what we'll look at over the course of the remainder of this year is, one, where does the science lead us in terms of understanding our molecules, the quality of those, our confidence in a path forward. Two, a reevaluation of the broader opportunity, and I think that includes competitive (inaudible), certainly, as with all programs that evolves as you move forward through preclinical development, and this doesn't seem to be an exception.

That said, it's a pretty rare opportunity to have a program you're excited about fall back to you in this manner, so because of the mechanism and the fact that L2 may, in fact, be a driver of disease, there's a lot of interest here to figure out what's the best path to bring this program to patients.

So, maybe, Marion, do you want to add a little color just in terms of mechanism and competitive landscape?

Yeah, as Jeff mentioned, I think we are very excited to explore the opportunity to potentially advance that on our own. We feel that the mechanism we are targeting and all molecules are designed to inhibit mutated L2, which we believe is the driver for that disease. So we feel that our mechanism is really going after the underlying heart of that disease and provides really a great opportunity to make a major difference in that very severe rare genetic disease.

So as we move along, I mean, obviously there are, as you mentioned, Regeneron is out there. Their molecule is targeting one of the (inaudible), and so it's a different approach. And hopefully, in the end, one of those will make a difference for patients, but we think that going after the mutation and the real genetic driver is a very, very promising mechanism.

Your next question comes from the line of Carmen Augustine from Jefferies.

So for BLU-285, we have expansion enrolling now at 300 milligrams in mastocytosis, and then you're looking at somewhere between 300 milligrams to 400 milligrams in GIST. Could you speak to pricing strategies in each indication in the context of their relative sizes and pricing of approved drugs?

I think at this point, we're way too early in our clinical development to speculate on price. I often maintain that by the time we move these two potential commercializations, the landscape will in all likelihood have changed in some manner. But I'm a firm believer that if you have a therapy that is targeting a driver of disease and you have clinical data that supports that you're having a major impact, that type of innovation will support premium pricing.

And I think we've been somewhat fortunate, when you look at systemic mastocytosis in GIST that active doses have paralleled one another relatively closely. And maybe taking that one step further, it was the activity in advanced systemic mastocytosis at a very low dose which really opened our eyes and increased our enthusiasm around moving forward with clinical development in indolent systemic mastocytosis.

So there, having the differential in dose may provide us with real pricing flexibility as we take one molecule forward in multiple different disease states. So, short answer, too early to speculate, but, too, the clinical data is guiding us in a direction that we think we're very fortunate.

Okay, great. Thanks for the color. And then one more on 285 and SM, if I could. Are you expecting that data to be presented at ASH? And anecdotally, have you noticed any changes in enrollment of the trial since (inaudible) approval?

Sure, maybe I'll take the first portion of that and Andy, I'll let you talk about anecdotal enrollment. So what we've got to do is that we'll provide an update by the end of this year, and ASH is certainly a very logical venue for us to share data.

In terms of enrollment, yeah, the study continues to enroll well. Midostaurin was available through compassionate use in US and Europe already when the study started. So the approval so far has not really affected the conduct of the study, and I don't actually think it will.

Your next question comes from the line of Mike King from JMP Securities.

A lot have been asked, but I just wanted to touch on 285 for the PDGFRalpha population. Just wondering, as far as the turnaround for the Phase 3 population, you say you're approximately 50 patients, and I thought I read it correctly, maybe I'm wrong, first half of 2018 before that's fully enrolled? Is that correct, Andy, or am I mistaken there?

We are aiming to complete the enrollment in the first half of 2018.

Of the 50 patients?

Of the 50 patients, exactly. That's correct.

Now, is that -- I hesitate to jump to commercial potential for that, but given that the enrollment's been ongoing, and I forget exactly what the last reported number of patients was with PDGFRalpha D842Vs, but is that any kind of an indication of the population size or the market potential just as far as the ease of which you're able to recruit these patients?

So our estimate is in the major markets, meaning US, EU5, and Japan, that there's approximately 500 to 700 of these patients with PDGFRalpha-driven disease. Make up about 5% of the advanced GIST population. And what we're experiencing now, and it's been the case since we've started the trial, is that most of the patients with PDGFRalpha mutations do seem to migrate to larger academic sites. And so that's why, early on, the rate of enrollment was certainly faster than we would have anticipated. So there's nothing that's changed from that perspective.

One of the things we're doing is, of course in the context of a clinical trial, you don't have all sites that see the patient as part of your study but we are adding sites currently, so would expect to find more patients in other geographies, be it regions of the US or new countries within Europe.

Okay. And that 500 to 700 is an incidence number, right?

Yep.

Okay. And is there any kind of a prevalence outside that? I know they have a poor prognosis, but I didn't know if there was any --

No, there is not at this time. If you look at historical norms, the response rate is close to 0% with I think a survival of around a year or so, and I think that's part of what's so compelling about the data set that we shared at ASCO is that hopefully we could be the type of therapy that helps to create a prevalence number.

Okay, great. And then for SM, I know that you've said that -- or you may have said that there are maybe some indolent patients in the mix of the expansion part of the study. Is that correct, and do you think you might have some of that data at ASH as well?

So the ongoing study is specifically for patients with advanced systemic mastocytosis. You know, we are doing a central pathology review to confirm diagnosis, and over the course of the study, likely we will end up with some patients who didn't quite meet the criteria for advanced, and so they'll be indolent patients. But if so, they'll be right on the edge. And we won't have enough of those, we'll be calling that out, I don't think, specifically at ASH.

But because of the activity in the current study at the initial dose levels, which are -- at the low dose levels, which are very well tolerated for prolonged periods of time, that's really what's gotten us so excited about indolent systemic mastocytosis as another opportunity. And the plan is to -- well, we're actually already meeting with clinical advisors and thinking about what a study would look like in that population, and expect to pursue that next year as a specific (inaudible).

Great. That's helpful. And then finally, real quick, on FOP. Is the program clinic-ready, or are you unwilling to say at the moment when that might be ready for clinic?

We have not disclosed that previously. As I said, our focus now is on the wind-down with Alexion, and once we're through that we'll be looking to provide a more robust update on status of the program and potential plans that we will have, either on our own or in some form of collaboration or otherwise.

(Operator Instructions) Your next question comes from the line of David Nierengarten from Wedbush.

Most of my questions have been asked, but we saw, of course, Agios approval and pricing yesterday, which I believe is a record in terms of monthly cost for disease with roughly similar incidence to -- or prevalence to your mutated forms of GIST and other rare indications. Does that provide a new benchmark kind of pricing that you're looking at? I know it's pretty early, but in terms of thinking about, again, prevalent severity, et cetera. And then, to follow up on another question, does that complicate or change, again, any plans for the 285 indolent mastocytosis pricing potential?

So first off, it was great news to see yesterday from our neighbors at Agios and certainly, great for patients of AML. Marion Dorsch, our chief scientific officer, was closely involved with that in that program while she was at Agios, and I know she takes a lot of personal pride in seeing that program now reach commercialization. So I think I'd start with that.

From a pricing perspective, again, the landscape's changing rapidly enough that I don't think we shift directions based on each subsequent approval. In fact, if you look at Midostaurin in the context of advanced SM, I think that the pricing there is more aggressive where you really see that intersection of rare genetic disease and oncology come together. But our data will lead us to what we think the value is at the time when we're much further along than where we are today.

To the second part of your question, in terms of complicating with indolent, I would say perhaps that our view is the opposite, that the activity we're seeing at 300 milligrams and 400 milligrams in advanced systemic mastocytosis and GIST, and the fact that in systemic mastocytosis we saw clear activity starting at 30 milligrams, has really opened up a meaningful window where the notion with indolent SM where it's the same genetic driver, same mutation, D816V, may give us flexibility from a pricing perspective rather than restricting our ability to take that program forward, which was probably our view prior to starting the clinical trials, that that was going to be a hard patient population to access. I think we're much more optimistic at this point.

Your next question comes from the line of Arlinda Lee from Canaccord.

First I guess on 285 in the systemic mastocytosis, you mentioned that you'd be using the IWG criteria. And I guess I'm curious, by the time -- by year-end, what proportion of patients do you think might have biopsies? And then maybe can you talk a little bit about the key considerations and issues you have with moving into indolent?

So, yes, we are using the ECNM IWG criteria as the definitive response criteria for the study. And I think importantly, the approval of Midostaurin really has validated that as a regulatory endpoint. So that's incredibly helpful for us as we think of the next steps forward in advanced systemic mastocystosis.

All patients get biopsied at baseline, and then the way the study is designed, I think it's pretty typical, patients get biopsied at two months. But then after that, it's more infrequent. So the number of patients with biopsies and that we have data for will really just depend on the timing since they were enrolled on the study. And I think it's premature to give you particular numbers about that. Certainly, that will all be presented -- when we present data, we'll give you -- we'll at that point know the details. But there's been no trouble getting biopsies, so we would expect to have biopsy data on essentially all of the patients on the study.

In terms of indolent, could you maybe just repeat the angle of your question on the indolent?

What are our considerations.

Considerations for?

Moving forward.

So there, we are -- I think the first step is to see how the data evolves in the advanced population and better understand response across the dose levels and understand where we think we'll have the most potent activity. But we're already actively talking with clinical advisors and thinking about study designs for an indolent patient population. The next step would be to start developing some protocol concepts, and we plan to have some interactions with regulatory authorities next year on the topic. So I think it's an emerging process that we'll develop over the coming months, but there is nothing -- at this point, we think we should pursue indolent as an opportunity.

Okay, great. And then I guess maybe as a follow-up on 285 expansion, is there opportunity for you to enroll second-line GIST in the trials that are ongoing, or might that be an exploratory other trial that you'd be looking to start?

So, as I think we've discussed before, we are very interested in looking at BLU-285 in earlier lines of therapy in GIST, including second line. I think we think that our data in the KIT-driven population that we've seen so far is actually very encouraging. That's in a population of actually a meeting of fifth-line therapy patients with a very heterogeneous mutational profile. 85% actually had prior regorafenib. And based on other experiences in GIST and the general experience in solid tumors, we would expect that that activity would become more robust as we move earlier in therapy where patients have been less pre-treated, have probably simpler genetics.

So the short answer is that, yes, we're very interested in exploring 285 in a dedicated second-line population, and we're currently talking with advisors and thinking internally about the best approach for making that happen.

And then lastly on FOP, at some point you had talked about priorities of your different earlier programs. I'm kind of curious now that you've gotten it back, how does this slot into your priorities with the fibrolamellar carcinoma program?

Good question. I take it we maybe didn't say it very clearly, we don't have room for this program as we operate right now. The number of programs we have advancing that we're constantly looking at how we prioritize across programs regardless of stage, what our nomination process is for new programs and they're either wholly owned or under the Roche collaboration -- so I think I started off on the call saying that some of our past success has just earned us the opportunity to work harder. That's what we're feeling right now, that we're working hard.

But, that said, having a molecule that we believe in as much as -- or a program that we believe in as much as the FOP program, that will have a seat at the table. We'll have to figure out what the best option is, and that may mean (inaudible) other programs. It doesn't necessarily mean it'll be vis-a-vis another program at the same stage. But that will be part of a comprehensive program review that we'll do over the course of the remainder of the year. And whether that had come back to us or not is always something that we do and something that we take very seriously, that we think the best way to bring medicines to patients is to focus on execution.

And we are never satisfied with how we're doing it or how fast we're moving or how effectively. And so, I simply look at this as a real opportunity to help a patient population that has a devastating disease, and so we take that seriously.

And your next question comes from the line of Mike King from JMP Securities.

One of the conversations I've been having with clients recently is about competitors in the FGFR4 space, both public and private. I don't know if you would care to give or want to give kind of a competitive profile of 554 relative to competition as far as activity, binding affinity, et cetera. But I just thought I would ask.

So we definitely focused primarily on our compound, and we think that the profile of 554 as an FGFR4 inhibitor is pretty unique. It's extremely potent and really exquisitely selective, probably the most selective compound that we have in the clinic at this point in time. For FGFR4, we think that the -- well, even from our clinical data, actually, not only do we think, we know that has avoided the typical toxicities of the pan FGFR inhibitors. Things like hyperphosphatemia have been really (inaudible) for those. It's not been an issue with our compound.

And so, where we are now is that based on the data we presented at the triple meeting last year, and of course you'll see updates coming up in ESMO, we have I think established proof of concept that BLU-554 is selectively active in an FGFR4-activated population. We are confident that we have a selection method that is identifying these patients, although as I mentioned in my prepared remarks, we want to further explore this to see if we can optimize things even further. So I have no doubt that we have a terrific molecule.

The main competition, I suppose, that's out there for FGFR4 would be we know that Novartis has a compound out there, and they have presented some data. I think that all I have access to is their publicly-presented data, and I think it probably is a good molecule, but I think there's still uncertainty in terms of how the patients are being selected, what the level of activity is, and I think that'll play out as we both present data as the studies evolve.

There are a couple of other compounds that are earlier on.

Yeah, I'm thinking like [Insight] and H3.

And, you know, really, we don't know much about those compounds. We know that they're good companies, they probably make good drugs, but they're behind us and we don't really have any specific information.

And this concludes the Q&A portion of the call. I would like to turn the call back over to Jeff Albers for some closing remarks.

Thank you, Operator. So to conclude, I want to reiterate our excitement for the second half of this year. As I said earlier, we plan to present updated data from our ongoing Phase 1 study of BLU-554 at ASMO in September, and we remain on track to announce updated data from our ongoing Phase 1 study of BLU-285 in systemic mastocytosis before year-end.

I want to thank you all for your continued support and interest in the Blueprint story, and I look forward to updating you again soon. Thanks for your time and have a great day. Bye-bye.

This concludes today's conference call. You may now disconnect.