Clovis Oncology Inc (CLVS) 2016 Q2 法說會逐字稿

Good day, ladies and gentlemen, and welcome to the second-quarter 2016 Clovis Oncology, Inc.'s earnings conference call. At this time, all participants are in a listen-only mode. Later, we will conduct a question-and-answer session, and instructions will follow at that time. (Operator Instructions)

I'd like to introduce your host for today's conference, Ms. Breanna Burkhart. Ma'am, please begin.

Thank you. Good afternoon, and welcome to the Clovis Oncology's second-quarter conference call. You should have received the news release announcing our second-quarter 2016 financial results. If not, it is available on our website at clovisoncology.com.

As a reminder, this conference call is being recorded and webcast. Remarks may be accessed live on our website during the call and will be available in our archive for the next several weeks.

The agenda for today's call is as follows. Patrick Mahaffy, Clovis's President and CEO, will discuss the key components of our corporate update provided in today's news release, as well as an update on our clinical development program. Then, Dan Muehl, Clovis's Vice President of Finance, and Principal Financial and Accounting Officer, will cover the financial results for the quarter in more detail. Patrick will make a few closing remarks and then we will open the call for Q&A.

Before we begin, please note that during today's conference call, we may make forward-looking statements within the meaning of the federal securities laws, including statements concerning our financial outlook and expected business plans. All of these statements are subject to risks and uncertainties that could cause actual results to differ materially from those described in the forward-looking statements.

Please refer to our recent filings with the SEC for a full review of the risks and uncertainties associated with our business. Forward-looking statements speak only as of the day on which they are made, and Clovis undertakes no obligation to update or revise any forward-looking statements. Additionally, please note that we'll be discussing adjusted net loss, a non-GAAP financial measure, during today's conference call. Required disclosures related to this are in today's news release, which can be found on our website.

Now I'd like to turn the call over to Patrick Mahaffy.

Thanks, Breanna. Welcome, everybody. Thanks for joining us. Let me jump in with an update on rucaparib. In June, we completed our NDA submission to the FDA for rucaparib for the treatment of patients with advanced ovarian cancer with deleterious BRCA mutated tumors, inclusive of both germ-line and somatic mutations.

This NDA is based on a pool of data of patient subpopulations from our ongoing treatment studies -- Study 10 and ARIEL2 Parts 1 and 2, and includes platinum-sensitive, platinum-resistant, and platinum refractory patients. We anticipate the FDA will provide notification in late August whether they have accepted the NDA filing for review, and at that time, provide a PDUFA date in the event the filing is accepted.

Foundation Medicine, Clovis's companion diagnostic partner, submitted a PMA application for its diagnostic assay, designed to identify both germ-line and somatic BRCA mutations to the FDA at the end of June as well. Timing of the PMA submission is expected to allow for regulatory approval of the companion diagnostic at substantially the same time that rucaparib would be approved.

Our US commercial team is actively preparing for launch and will be ready to launch at the time of potential approval. In addition, an MAA submission to the EMA for comparable ovarian cancer treatment indication is planned during the fourth quarter of 2016. We were also pleased to learn recently that an abstract based on the ovarian NDA data set was accepted for an oral presentation at ESMO in October of this year.

Turning to ongoing studies with rucaparib, ARIEL3 is our Phase III registration study in the maintenance indication comparing the effects of rucaparib versus placebo. The study is evaluating whether rucaparib given as maintenance therapy in platinum-sensitive high-grade ovarian cancer patients, who have received at least two or more prior lines of platinum-based chemotherapy, can extend the period of time for which a response to a prior chemotherapy is maintained.

Targeted enrollment in ARIEL3 was completed early in the second quarter. And based on the timing of events and comparable maintenance studies of other PARP inhibitors, we currently expect data from this study in Q4 2017. Patients in this study were randomized 2-to-1 to receive either rucaparib or placebo, and the primary endpoint of the study is progression-free survival.

The primary efficacy and analysis we'll evaluate in a step-down process BRCA mutant patients, that all patients with a BRCA mutation or BRCA-like signature, followed by all patients. Pending positive data, we would intend to submit a supplemental NDA for the second-line maintenance indication for advanced ovarian cancer patients.

Clovis recently entered into a clinical trial collaboration with Genentech -- a member of the Roche group -- to evaluate a novel combination therapy of their cancer immunotherapy, atezolizumab and rucaparib for the treatment of gynecological cancers, with a focus on ovarian cancer. The Phase Ib trial is expected to begin screening patients in Q1 2017. We and our investigators are very enthusiastic about the potential for this combination.

Two investigator-sponsored studies exploring rucaparib's activity in different breast cancer settings are underway or initiating later this year, and an additional investigator-sponsored study in gastroesophageal cancer is expected to initiate later this year as well.

Prostate cancer is a high priority indication for us, as it includes a substantial number of patients with BRCA and other mutations that may be responsive to rucaparib. We plan to initiate two Clovis-sponsored prostate cancer studies in the next few quarters.

First, a Clovis-sponsored Phase II single-arm study inclusive of patients who have a germ-line or somatic BRCA mutations, or ATM mutation, or other deleterious mutations in homologous repair genes who have progressed after receiving one line of taxane-based chemotherapy and one or two lines of androgen receptor targeted therapy in the castrate-resistant setting.

The planned primary endpoints are radiological overall response rate in patients with measurable disease and PSA response rate in patients without measurable disease. We anticipate this trial will initiate by the end of this year.

Our second Clovis-sponsored study is a Phase III comparative study inclusive of patients who have a germ-line or somatic BRCA or ATM mutation, who have progressed on AR targeted therapy and not yet received chemotherapy in the castrate-resistant setting. The study will compare rucaparib to physician's choice of AR targeted therapy or chemotherapy. Planned primary endpoint is radiologic progression-free survival. We anticipate this trial will initiate in Q1 2017.

Additionally, in collaboration with the Medical Research Council in the UK, rucaparib will be studied in what is known as the strat STAMPEDE study, a newly-diagnosed, castrate-sensitive de novo metastatic tumor BRCA mutant and BRCA-like prostate cancer patients. This is expected to begin in mid-2017.

And lastly, and returning to ovarian cancer, we intend to initiate the ARIEL4 confirmatory study during the second half of 2016. ARIEL4 is a Phase III multicenter randomized study of rucaparib versus chemotherapy in BRCA mutant patients with relapsed high-grade epithelial ovarian, Fallopian tube or primary peritoneal cancer, who have failed two prior lines of therapy.

During the fourth quarter, we expect screening to begin for investigator-sponsored Phase II study in first-line maintenance in ovarian cancer patients, which will evaluate three arms of therapy -- rucaparib as monotherapy, following a platinum doublet, including paclitaxel; bevacizumab monotherapy, following platinum plus paclitaxel and bevacizumab; and rucaparib plus bevacizumab in combination, following platinum plus paclitaxel and bevacizumab. The primary endpoint of that study will be progression-free survival.

Moving on briefly to lucitanib, our oral inhibitor of the tyrosine kinase activity of VEGF PDGF and FGF receptors. As you saw today, together with our development partner, Servier, we have decided to discontinue development of lucitanib in breast cancer. We anticipate making a decision regarding the future development, if any, of lucitanib over the next several quarters.

As a reminder, all development costs for lucitanib are still paid by Servier, as we wind down the ongoing trials. Now let me turn the call over to Dan to discuss second-quarter financial results.

Thanks, Patrick, and good afternoon, everyone. Our second-quarter 2016's financial results were included in this afternoon's press release. I'll review the highlights of our financial results and provide some additional commentary.

Let me start with our balance sheet. We ended the second quarter with $378.5 million in cash, cash equivalents, and available for sale securities. Cash used in operating activities was $68 million for the second quarter of 2016 and $151.7 million for the first half of 2016. This compares with $57.2 million and $105.6 million for the comparable periods of 2015.

Cash used in operating activities in the second quarter was down $15.7 million or 18.8% compared to the first quarter of 2016. We reported a net loss of $129.3 million or $3.37 per share for the second quarter of 2016, and $212.7 million or $5.54 per share for the first half of 2016. Our operating results for the second-quarter and the first-half includes a net expense non-cash impact of $49.9 million related to our 2013 acquisition of lucitanib product rights, which we obtained through the purchase of Ethical Oncology Science, or EOS.

First, in the second quarter of 2016, we recorded a non-cash impairment charge of $100.5 million to reflect a reduction in the estimated fair value of the intangible asset related to lucitanib recorded as part of the EOS purchase price accounting. This reduction in fair value was the result of our and our development partners' decision to discontinue development of lucitanib for breast cancer.

We also recorded a non-cash deferred income tax benefit of $29.2 million associated with this charge. In connection with the acquisition of EOS, Clovis is obligated to pay additional consideration to the former EOS shareholders if certain future regulatory and sales milestones for lucitanib are achieved. The estimated fair value of these contingent payments is recorded as a liability on the Company's balance sheet.

During the second quarter of 2016, we recorded a non-cash $25.5 million reduction to zero in the fair value of the contingent consideration liability, due to a change in the estimated profitability-weighted future milestone payments. This reduction is included as a credit to operating expenses in our 2016 results of operations.

On a non-GAAP basis, we reported an adjusted net loss, excluding these items, for the second quarter of 2016 of $79.4 million or $2.07 per share, and $162.8 million or $4.24 per share for the first half of 2016. The net loss for the second quarter of 2015 was $71.5 million or $2.10 per share, and $134.7 million or $3.96 per share for the first half of 2015.

Our second-quarter R&D and general and administrative expenses totaled $67.7 million and $142.3 million for the first half of 2016. This compares to $60.4 million and $117.1 million for the comparable periods in 2015. The year-over-year increase in expenses is primarily due to increased development activities for the rucaparib program and increased personnel-related expenses, partially offset by lower expenses related to clinical development activities for rociletinib.

In addition, Research and Development expenses in the second quarter of 2016 was down $6.9 million or 10.2% compared to the first quarter of 2016. General and administrative expenses totaled $9.6 million for the second quarter of 2016 and $19.4 million for the first half of 2016. This compares to $7.2 million and $14 million for the comparable periods in 2015.

The increase year-over-year is primarily due to higher legal expense, consulting fees, and personnel costs for employees engaged in general and administrative activities. Operating expenses for the second quarter of 2016 include share-based compensation expense totaling $9.5 million and $20.5 million for the first half of 2016.

Now, looking forward, we expect our cash used in operating activities for 2016 to be between $294 million and $309 million, and we will end the year with between $220 million and $235 million in cash, cash equivalents, and available for sale securities. As a reminder, the year-end cash guidance assumes a payment of milestones of $21.75 million based on the US acceptance and approval of the rucaparib NDA, and the EMA acceptance of the rucaparib MAA.

Now I'll turn the call back to Patrick for some closing remarks, and then we will open it up for Q&A.

Thanks, Dan. We've got a very meaningful second-half ahead of us. We anticipate receiving the FDA's decision on acceptance of our NDA for rucaparib in the treatment of advanced ovarian cancer by the end of this month. The NDA data set will be the subject of an oral presentation at the 2016 ESMO Congress in Copenhagen in October. Our US commercial and meta affairs organizations are in place and actively preparing for potential approval and the associated launch of rucaparib. And we are enthusiastic about the initiation of additional trials to expand rucaparib development into other oncology indications later this year and in early 2017.

Finally, we plan to complete the MAA submission for the treatment indication for advanced ovarian cancer to the European authorities by the end of this year.

We will now open up the call for Q&A.

(Operator Instructions) Peter Lawson, SunTrust.

Just on ESMO oral presentation, what are we likely to hear? What data sets?

Yes, I'm happy to answer that, as I think I described herein, we've talked certainly quite a bit about -- data in the NDA come from two populations: from Study 10, which was effectively the Phase I/II study of rucaparib; and then from ARIEL2, Parts 1 and 2. In our dialogue with FDA that led to our decision to go down this path, in our pre-NDA meeting and now our submission, we had agreed with FDA to submit data on a specified number of patients who were mutant BRCA, and FDA did not -- was not concerned about their platinum sensitivity or their platinum status.

So, we, of course, in the conduct of these trials, have enrolled platinum-sensitive, platinum-resistant and platinum refractory disease. All the data we've shown publicly thus far has been in the platinum-sensitive setting, because it came primarily from ARIEL2 Part 1, which was in platinum-sensitive patients, and from Study 10, which enrolled primarily platinum-sensitive patients.

As we very clearly stated, we have a very impressive response rate, as high as it's ever been seen for a PARP inhibitor in the platinum-sensitive populations. It's obvious that, for reasons now we are really beginning to understand, as patients move forward through the treatment of their disease through multiple lines of platinum and become platinum-resistant, platinum-resistance is associated with a lower response rate to PARP inhibitors in general.

And so this will be an opportunity for us to describe the data we have combining both platinum-sensitive and platinum-resistant patients, but I can assure you that although the response rate is lower in the platinum-resistant patients, it does compare favorably to the approved products in the platinum-resistant population. So, it will be -- that presentation of the NDA data sets, along, of course, with the safety and other issues, all of which are consistent with what has been reported publicly.

Great. So we'll get a kind of full data set at ESMO?

You'll get a full data set on the NDA population, that's right.

Got you. And then ARIEL3, that seems to -- has moved forwards, and it was earlier than expected. What drove that earlier-than-expected data?

It's actually a later-than-expected data. For ARIEL3, you mean?

Yes.

Yes. For ARIEL3, we had originally expected that we would have data from ARIEL3 a year or so following the last patient enrolled. Having seen a recent data on a different PARP inhibitor, it became prudent for us, given our expectations for the drug, to extend that timeline by about four or five months. So we now expect a complete story on ARIEL3 in the fourth quarter of 2017.

So, in fact, we've delayed it. We haven't brought it forward.

Got you. Okay. That looks encouraging. Great. And then how should we think -- just a minor point -- just how should we think about costs for Q3 and Q4? Just around SG&A and R&D, just back to the mundane?

So, R&D costs will decrease in Q3 and Q4, which will lead us to our ending cash guidance that we provided at [$220 million to $235 million]. G&A is going to stay relatively flat.

Perfect. Okay, thank you so much. I'll jump back into the queue.

Patrick Mahaffy

Thanks, Peter.

Tom Shrader, Stifel.

This is Alex Schwartz filling in for Tom Shrader. I had a question and then a follow-up question, if you will.

So the first question is, you are treating germ-line and somatic ovarian cancer patients in an all-comer BRCA mutated category, whereas other companies are lumping somatic patients into a BRCA-like category, so to speak. My question is, how much of a difference is there between somatic and germ-line patients? Is there any data out there that you can point to describing the similarity or differences of clinical benefit between these patients when they are taking targeted therapies?

You know, I'll take a crack at that and then Lindsay may add to it. So we look forward to seeing the presentation of the niraparib data at ESMO, where I think for the first time, we're going to have a really clear indication of how somatic mutated patients do compared to other non-BRCA HRD, and clearly relative to germ-line BRCA patients.

So the PFS information is limited at best. We do have response rate data. And, as I noted, in platinum-sensitive patients, we have a very high response rate. And at ASCO, this year we reported on around 20 patients with somatic mutations of BRCA and 20 patients with germ-line mutations of BRCA. The germ-line mutated patients in that population had an 85% response rate, and the somatics had a 75% response rate.

I think it's arguable that those are the same number, given that it's only 20 in each arm. It is also arguable, if you want to, that it may be the germ-line patients are marginally more responsive than the semantics. But I think more telling will be the PFS data that we see at ESMO.

Lindsay, would you say anything different than that?

I wouldn't say anything different from the data that, as you say, that we've shown. Responses look similar in germ-line and somatic BRCA mutated patients. Of course, we'd shown data thus far, as Pat said, from ARIEL2 Part 1, which was our study that had both somatic and germ-line mutated patients. Study 10 just had germ-line BRCA-mutated patients. And the data that we've shown so far from ARIEL2 Part 1 is in platinum-sensitive patients who have had one or more previous lines of therapy. And of course, the NDA will be a subgroup from within that population.

Okay. Very good. Well, thanks for the extra clarity. And if I may, another question I had was, so far, we've seen near 80% response rate in platinum-sensitive patients, and about half of them have seen one prior line of therapy. So, looking at olaparib's data in the third, fourth, and fifth line of treatment, the response rate is pretty constant, so it holds constant in sensitive patients as well as resistant patients. Is there anything that suggests that your response rate will hold up in later-line platinum-sensitive patients outside of what olaparib has shown?

Well, what we've noted is that for patients who are platinum-sensitive, we get relatively modest diminution of effect based on number of prior therapies. And you may recall that -- you're right; this population that we just described was 80% in patients who had three or more priors presented at ASCO a year ago, I think, we showed a 61% response rate.

So, the drop-off in response rate is not significant when compared, for instance, to a normal chemotherapy drop-out and drop-off rate that you would expect to see of quite a bit more than that. In platinum-resistant patients, they are going to have a different responsiveness, I think, to all PARP inhibitors, that's going to be more in the sort of 25% to 35% range.

And, for instance, in the olaparib data set, from the Susan Domchek paper at ASCO, they showed, in these later-line patients, a 46% response rate in the platinum-sensitive patients, but a 30% response rate in the patients who are described as platinum-resistant or unsuitable for platinum therapy.

So it's hard to know if they are all truly platinum-resistant or whether a portion of them a physician just decided, in the conduct of that study, that the tolerability issues for platinum were such that they would rather put them on -- that they would not tolerate another round of platinum and put them on a PARP inhibitor. So, in fact, there is a difference in the reported response rates for platinum-sensitive versus platinum-sensitive patients.

Okay. Okay. well, very good. Thanks for the additional color. I'll have to find that paper. Well, thanks, gentlemen.

It was a poster in ASCO in 2015.

Okay. Well, thanks again, and looking forward to future updates.

Great. Thank you.

Terence Flynn, Goldman Sachs.

It's Samir Siddhanti on for Terrence. Thanks very much for taking the question. Just two questions from our end. First, do you expect the FDA to convene and add comment to review rucaparib?

I think it's too early in the review process for us to know. It is relatively less common for them to convene and ad comment for a single-arm study seeking an accelerated approval, but of course that will be the FDA's decision. So it would be too early for me to speculate.

Okay, great. Thanks. And then the second question, what are your ex-US plans for rucaparib? And when can we expect an update there?

Our ex-US plans include initially -- well, we'll follow a regulatory path that is consistent with what we are following in the US. We'll file for approval in the treatment setting in the fall, and pending data from ARIEL3, we would then intend to file for approval following those data in the maintenance setting, which submission would probably be -- given the timeline we're on, would probably be made sometime in the first half of 2018.

We have a modest commercial organization in Europe. Over the course of these next several quarters, we'll determine whether we feel we have the resources to take it forward, whether we find some thoughtful partnership structure that allows us to continue to play a significant role, but would involve using an organization already available to a possible partner.

So, more to come on that, but we don't feel an urgency to do beyond what we are doing right now. And so we have the luxury of time.

Great. Thanks very much.

Caroline Palomeque, WallachBeth Capital.

Thanks for taking the question. Can you add a little more color on your launch preparations for rucaparib? And also on how you're thinking on -- about your pricing strategy. I just wonder if you could talk a little more about that? Thanks.

Yes, we'll launch in the US pending approval with our own organization. It is largely fielded today. We are going to add about 10 additional territory managers to come up to the number that we want to be at launch, and those positions are posted. So, it will be a very comparably-sized oncology organization to all over the vast majority of other oncology-focused organizations in the United States. We have not described our pricing strategy and would not intend to do so until we received approval.

Okay, thanks.

You bet.

Kennen MacKay, Credit Suisse.

Thanks for taking my question. Pat, you mentioned there was sort of a prespecified number of BRCA positive patients based on your conversations with sort of the NDA package for the FDA. Is this sort of similar to a number of patients that Lynparza was approved on in the BRCA-positive population? And is that sort of irrespective of the number of lines of prior therapy these patients have had?

No, very clearly based on a number of prior lines, and it is a number that is roughly comparable -- it's a little over -- than the number in the Lynparza label, but it's comfortable enough. And it's -- frankly, it's the number that we were provided by FDA.

Okay, got you. And then just based on your comment regarding the timelines on ARIEL3, you mentioned this was sort of based on a competitive PARP inhibitor that was out there. Just to be clear -- that was not based on sort of the rate of events accumulating in ARIEL3? Or that sort of did factor into it?

We do not have knowledge of the event rate in ARIEL3. So this is very clearly based on an external factor.

Got you. Okay, thank you very much.

Steven Breazzano, Piper Jaffray.

Thanks for taking the question. Maybe just a bigger picture one in ovarian cancer. How do you think about potentially using PARPs in the maintenance setting may impact later-line use of PARPs? And do you kind of see potential for retreatment with PARPs?

So this is the question that is highly relevant to how this space will evolve. So, first of all, as to retreatment, we will, I think, share at a scientific meeting this fall, early data on the cause of resistance to rucaparib from a small number -- it's not large, but a small number of patients at our trial -- or trials -- who have been re-biopsied. So we are really looking forward to that, because I think it's great science.

And I think it's really relevant science for this concept of re-treatment. And what I think it largely suggests -- although it's not a definitive answer -- is that PARP therapy following PARP therapy in a patient who has progressed -- so it's not for tolerability issues, but a patient who has progressed on their first PARP inhibitor is likely to yield very low response rates. Because we understand this mechanism and it should relate to all PARP inhibitors, not just one.

Now there may be some nuanced patients where the differences in structure allow it to be -- to work or not. But for the most part, I think most of us believe here -- and we want to test this in a trial -- that for one to be rechallenged with a PARP inhibitor, and have a chance of success, there probably has to be an intervening round of a non-platinum-based chemo, like a Taxol.

And we have a proposal to do that study with some collaborators, and are interested in ,if we can figure out a way to pursue it, in pursuing that. As to maintenance versus treatment, I think this is going to be -- it's certainly a dialogue that we've been having and personally with a number of investigators and KOLs. I think it's a fascinating dialogue about what is the best use, and maybe in different patients, what better use is better and what different use is worse, for the way to think about treatment.

So it is hard not to notice that PARP inhibitors come with a reasonable amount of toxicity, particularly myelosuppression. And there's always going to be a question about whether, in a maintenance setting where we don't have evidence yet of survival, whether the cost of that toxicity is worth it for PFS benefit.

And in particular, when you consider that the overall time for a woman on maintenance -- and let's say it's 20-odd months -- is going to be before she's going to have to go on some chemotherapy -- because she will have failed her PARP inhibitor, as we just discussed. And then you think about a woman who may have had, from the recent trial, six months of good quality of life that is both disease and drug-free, but then gets a 10 to 12 or 13-month PFS on treatment -- that's the same number.

And the question is going to be, who is appropriate for maintenance and for whom do we reserve the drug for the treatment setting? And I -- look, we have a huge study -- a 560-person study enrolled -- fully enrolled in maintenance. So we pursue this too. But given the recent information and data, I think for a really determined, perhaps more fit younger patient, maybe somebody who has young children, fighting for the longest period of progression-free survival as possible may be exactly what they and their physician -- she and her physician choose to do.

It may be a different story for the more reluctant patient, a 65-year-old woman whose children may be adults, who is much more focused doing this math and thinking about her quality of life. And especially that interval where she can be both disease-free and drug-free. I can guarantee you that we'll be happy when we have our maintenance data. We are optimistic about it. But it will not be a one-size-fits-all.

There will definitely be some patients and their physicians who prefer maintenance, but there will be definitely some who want that holiday, and will wait until they have the treatment, and the treatment option will, of course, be available to them. So, this is going to be a fascinating dialogue that occurs over the course of the next -- not just one year, but two years and three years, as physicians get used to best practice, and probably segmenting patients for the choice of maintenance versus treatment.

Got it. Thanks for the detail.

Cory Kasimov, JPMorgan.

This is Whitney on for Corey. First question was, I believe you had initially said you would provide us some update or topline data on the NDA data, or whatever went in with the NDA at the time you announced the NDA acceptance, or the filing acceptance. Is that still the case? Or now, with the ESMO presentation, will that not happen?

I think it's still the case that people want to see it. It will be pretty abbreviated because we'll want to reserve the totality of it for ESMO, but we'll -- we would expect to provide some information in that press release.

Okay, got it. And then on ARIEL3, have you disclosed how many events you need to trigger the PFS analysis? And then is there any -- are there any interims built into that trial?

There are not interims, and we have not disclosed the number of events that will trigger it.

Got it. Okay, thanks for taking the questions.

You bet.

Thank you. And our final question will come from the line of Roy Buchanan of Janney Montgomery. Your line is open.

Thanks for taking the questions. I had a couple on the prostate cancer studies. About how big do you expect those studies to be? And then how many patients are expected to be BRCA mutant or ATM mutant?

All of the patients in those studies will either be BRCA mutant or ATM mutant. The majority are going to be BRCA mutant. The single-arm study is around 150 patients. The comparative study is about 230 patients.

All right. Yes, sorry, I guess I meant how many patients out of the population are expected to be BRCA mutant or ATM mutant?

Sorry about that. There's an enrichment that occurs for BRCA-mutant patients. It turns out as diagnosis, it is a poor prognostic factor. So there is an enrichment in these CPRC patients for BRCA. And then further, we are just looking at some data. The incidence of somatic mutations also increases based on line of therapy.

I was meeting with one of our investigators who might have a slightly skewed population he thinks, but he thinks that about 25% to 30% of his CRPC patients are mutant BRCA or ATM. I think that's high, so that probably doesn't reflect the whole country, but it's likely going to be in this 15% to 20% range from what we've seen published.

Okay, great. And then Lynparza sold about $60 million in the first half. Does that concern you guys? Is it a function of the efficacy or physician education or something else? Do you guys have any thoughts on that?

Well, we don't, really. I mean, it has its advantages and disadvantages. We look forward to coming into the market with what we perceive to be advantages over that drug, and we are optimistic that as testing increases, as we think about adding an additional 10% of all ovarian cancer patients in our label through the inclusion of somatic mutations, we, in addition to growing the market, will be addressing a patient population that Lynparza is not labeled for. So we are optimistic about the potential here.

Okay. Last one. Thanks for your patience. The ARIEL2 Part 2, was there a cap on the number of prior chemotherapies?

In ARIEL2 Part 2, we allowed patients who had either three or four prior lines of therapy. So I guess that would describe a cap.

Yes. Thank you.

Thank you. At this time, I'm showing no further questions. I would like to turn the conference back over to Breanna Burkhart for any closing remarks.

Thank each of you for your interest in Clovis today. If you have any follow-up questions, please call me at 303-625-5023. This call can be accessed via replay of our webcast at clovisoncology.com, beginning in about one hour, and will be available for 30 days.

Again, we appreciate your interest and time. Thank you and have a good evening.

Thanks.

Ladies and gentlemen, you may now disconnect. Everyone have a great day.