Pharming Group NV (PHAR) 2024 Q1 法說會逐字稿

Welcome, ladies and gentlemen, to this first-quarter results conference. I'm here with my -- next slide, please -- I'm here with my three colleagues in order of speaking, Stephen Toor, our Chief Commercial Officer, who is joining us from our New Jersey office; Dr. Anurag Relan, our Chief Medical Officer, joining us from our US office as well; and Jeroen Wakkerman, our Chief Financial Officer, who is based with me here in Leiden.

Before I do that, I would like to point out to next slide, please, number three, that is the forward-looking statement slide. So we will be making forward-looking statements today in our presentation, and those are based upon our current plans and your insights of the -- and situations of the current market circumstances. And of course, actual results may differ from these forward-looking statements. So you cannot necessarily rely on those.

So having said that, I would like to go to slide number 4 and maybe even onwards to slide number 5, because you have seen my picture already. Yes, and here we are. We're building this leading global rare disease biopharma company. And we do that based on three pillars, and this is a very familiar slide for you if you've been here before.

On the left hand side, the foundation of our company, the product RUCONEST that comes from our own research, and it has already been on the US market for almost 10 years. It was approved in July 2014 -- recombinant protein replacement therapy for hereditary angioedema attacks. And as you can see, we are still paying growing this product, and we had a 8% growth versus last year this quarter. Good growth last year as well, and we see increasing numbers of prescribers and patients.

And there's many options for these patients available, but RUCONEST continues to play an important role. And we expect it to be continuing for the foreseeable future. And Stephen will talk a lot more about that in his part of the presentation.

Next, you see there, Joenja, the product we in-licensed from Novartis for the treatment of APS, an ultra-rare immune disorder, a new disease that was only discovered 10 years ago. And we already have the first disease-modifying drug on the market that we launched now a year ago, and you see with a very successful introduction of the product in the US market. Stephen will allude to that as well.

We're very proud that we can actually record of $9.6 million sales in this quarter, good growth versus the 4Q of last year. And you see here, if you add both numbers, we realized [$28 million] of sales for this product in the first 12 months on the market. It's a newly described and ultra-rare disease, and there's a very strong focus, therefore, on base definding. Both Stephen and Anurag will talk about that and how we go about that to find those patients.

We're also very pleased to see that very recently we got the second approval in Israel at the end of April '24. We have a lot of regulatory reviews ongoing and alot of trials ongoing, and Anurag will talk about that a lot more. And on the right-hand side, the possibility to leverage our commercialization infrastructure, both in the US and outside of the US by not only finding new compounds hunting for clinical stage or later stage compounds to in-license or acquire to actually leverage.

But first and foremost, we have a very interesting opportunity in leniolisib to develop it further for a second indication for primary immune deficiencies with immune dysregulation beyond APDS, where we are preparing -- in final stage of preparing a Phase II (technical difficulty) study. And in addition, we're working on a third primary immune deficiency indication in early stage at this point in time. And Anurag will talk about that a lot more.

And on the bottom of the slide, you see that we have a total revenue guidance of between $280 million and $295 million for this year, driven of course, by Joenja, but the foundation is, of course, RUCONEST underneath that.

And then you see the next slide a little bit more in detail because we're going to talk a lot about the potential for Joenja today. Joenja for APDS is the first stage where we are currently now in a market with a 12-plus indication in the US, where we already found a significant portion of the identified patients on paid therapy, where we have a lot of ongoing search for patients and so-called variance of uncertain significant mutations as ongoing.

The next step, of course, and what you already see, and that's, of course, an interesting observation on all, almost $1.1 million of sales in this quarter already outside the US. So in other words, we're starting to work on the global expansion of the product. And the pediatric studies will further boost that (technical difficulty) to get a full label and full geographic coverage for our Joenja in APDS.

And then as I said already earlier, the bigger indication that we are starting the proof-of-concept trial in the not-too-distant future for the bigger indication of PIDs with immune dysregulation with similar symptomatology to APDS. So having I given you this introduction. I would like to now point out -- I would like to now hand over to my next -- to the next speaker to Stephen Toora, our Chief Commercial Officer.

Steve, over to you, please.

Thank you, Sijmen. Hey, everybody. But so is there (technical difficulty) if you could go to the (technical difficulty) So the key pieces of the (technical difficulty) haven't continued to (technical difficulty) in routes over the last year's report. Those unique work attributes and the exceptional customer service and execution by our customer-facing teams is why we (technical difficulty) continues to have made us a highly relevant conversation in the [HAE].

That remains the case despite the installation of the treatment landscape, we personalize communities in Arizona, we should be kind of and it will continue to remain in the face of more acute competition in the coming years. [HA] mentioned (technical difficulty) generally elements of a course of disease, and they need a virtually guaranteed and fast and first efficacy that stops and attacking these tracks reconnects unique product features in the mode of administration, deliver that in a way that future options come.

So as you know, 2023 was a strong year with solid growth in prescribers, new patients and sales that was that success was in spite of the market would have been related to reimbursement for government patients in Q1. And in Q4, we've seen less of an impact as the patient's out-of-pocket responsibility almost half. The strength of leading indicators has continued into this year, and we've had a strong Q1, up 8% on prior year. And we exit 2020 or Q1 '24 on track to achieve the revenue guidance, which, as previously discussed, as seem to be low to mid-single digit growth for refinish.

He go to the joint slide, please. As you know, we were strong out of the gate with the launch of Joenja with patients fully reimbursed within days. And that momentum build through year one, and it continues into 2024. So we now have 83 patients fully reimbursed with probably more in process being processed with 15 newly diagnosed patients in the quarter, taking us past 220 close to half the number of patients. The literature suggests they're out there, although we believe there are more and we have over 50 more diagnosed patients whose doctors who firm that we're working with their physicians to enroll into our program plus of course, 50 plus paediatric patients who are being diagnosed could potentially go in joint treatment when the paediatric label expansion is approved.

So this means we exit Q1 just shy of [$10 million] in sales 21% up on prior quarter, as we discussed in March on our 2023 for the full year call, as we convert the caseload identified at launch, our focus moving forward, remain holding new patients and given a PDS is not there. So no dominant because the condition this means testing families to uncover additional patients with this progressive disease. So they too can benefit from management treatment. And we're also working to resolve the US's for the many patients who have these results, which [Andre] will discuss further. And as we reconnect the results for the quarter in line with our financial guidance for the year.

Can you go to the next slide, please?

So our US teams continue their patient finding education and genetic testing efforts to build the APDS patient base. At the same time, we remain laser focused on reconnect execution and while at different stages in the commercial cycle, both Ruconest and Joenja are critical to our growth.

Now I've already covered the USA and you see on the first pillar for [ex] US alongside the US launch, we continue to build our capabilities in preparation for launches in the EU, UK, Japan, Australia and other Asia Pacific countries. Our [S]. teams I focused on both educating finding potential patient testing and diagnosing and continue to build that patient from all in readiness for the steady flow of launches that we have in the coming years. And so far, we've identified over 800 patients in those three key launch markets.

And we also see multiple years of growth ahead for Joenja with initiatives such as family testing in the US validation that should contribute modest additions to patient numbers in 2024. We expect those initiatives to have a more significant impact in 2025 when we see a potential for a few hundred patients to be on Challenger And altogether, the APDS opportunity, as you know, is at least 1.5 million patients, 1.5 sorry, patients per million or approximately 2000 patients in these key markets of which we've already found a large number.

And while the ex US prices are expected to be lower than those in the US, the overall APDS opportunity is still significant. So much of our organization is focused on a PDA on Challenger for APDS. We're also just seeing the final column focus on developing [leniolisib] for additional indications. So this is a good moment to hand over to our Chief Medical Officer, Anurag Relan.

Thanks, Steve. Next slide, please. And then if we can go to the US launch of [Joyn], just like Next slide. Thank you. And as you mentioned, Steve, without a strong launch of Joenja in the US., this reflects both the unmet need and the clinical experience with Joenja and to review Joenja that's approved for the treatment of APDS in adult and paediatric patients, 12 years of age and older. And this approval was based on data from a randomized placebo-controlled study that showed Joenja met both primary endpoints with significant benefits also seen in the secondary or exploratory endpoints.

Importantly, what we've seen across the development program is that Joenja has been generally safe and well tolerated. And this data has been seen not only in the randomized study, but also in the ongoing long-term open-label extension study. In that study. We also saw benefits with patients being able to reduce or discontinue their use of immunoglobulin replacement therapy. And we also also saw reductions in infection rates over time. We continue to share this data on the long-term use of Joenja in from these studies as well as from post-marketing experiences.

Next slide. And as with many rare diseases, patients have a long journey to reach a diagnosis. We have several efforts now ongoing to help patients get a correct diagnosis quickly. The first centers around medical education to raise awareness about APDF. and share data on [leniolisib] for example, recently, we've shared that information about the seriousness of APDS by publishing data on early mortality and the frequency of lymphoma in these patients.

We've also been discussing for example, the frequency of bronchiectasis, a lung complications that is often seen in these patients at a young age to help doctors be able to recognize the types of symptoms that APDS patients may have and to be able to perform a genetic test, which is actually the only way to make a diagnosis now to make that diagnosis, we could have made that genetic testing available through a sponsored no-cost testing program.

We also have assistance from genetic counselors to be able to help patients and physicians interpret the results, and we're working closely with these patients and their doctors to also help perform family testing because as an inherited disease, we know that these there are more patients than the patients that we've uncovered. So far, we found in fact that most patients have not had proper family testing such as testing of parents or siblings to ensure that all of those members of their family can also receive a correct diagnosis.

And we have several programs now in place to help assist with that type of effort. And as you've heard us talk about several times now getting that genetic test is important for these patients, but also interpreting the result is critical. And unfortunately, many patients can after they get a genetic test, can get a result called a variant of uncertain significance. What this means is that these patients have a variant or a mutation that hasn't been previously described. And what we found is that there's a significant number of patients who have actually already received the VUS test results just in the US about 1,100 such patients.

We're working closely now with a number of groups to help curate all of this data and put that into a single central database. And on top of that, what we need to do is perform further testing to determine whether that variant is disease causing or not. Recently, we've been able to start a functional testing program whereby patients can get access to a functional test that can help them determine if they have APDF and we are seeing already the results of those in the first quarter of our patients who had a US result got a functional test and then eventually kind of diagnosis of APDF, some of them already on Joenja and to address this problem more firmly on more completely.

We also have a large study called the main study, which will allow us to determine the all possible variants. And we're hoping that this reads out by the end of the fourth quarter, I should say we're expecting that this is going to by the end of the fourth quarter to be able to eventually answer the question of which patients who have b the US actually have APDS group. Next slide, in addition to the work that we're doing with Joenja in the US, we have several projects to bring Joenja to patients in other countries and to younger patients. We have an application under review, for example, that in Europe and we are awaiting now CHMP opinion, we anticipate being on the main agenda for a CHMP opinion.

So that will be later this month. We also have completed enrolment in our Japanese clinical study, and we're working with the regulatory authority there to determine the filing strategy following the completion of the clinical trials that are ongoing and then we have two paediatrics. And the first is on children ages four to 11, and enrolment is completed there. And then we have an ongoing study that you see on the right for children ages one to six year old using granules. And we have the first patient dosed last year and Enrolment is continuing there. Considering all of these clinical trials as well as expanded access and named patient programs.

We have 138 patients receiving Joenja through these various programs. And as you heard from Simon. We also received recently the marketing authorization in Israel. We have a number of reviews ongoing, including in the UK, Canada and Australia, and we're expecting regulatory action on those reviews in the course of 2024 and 2025. And then we're very excited also about the possibility of using leniolisib outside of APDS. And I'll be talking a little bit more about that.

Now in the next slide, you can begin to see through our work in APDS. We have a better understanding of the broader PID landscape.

Next slide, please. And what we see is that there are a large number of PIDs. Obviously, these PIDs have an increased risk of infection but we also see there's a subgroup of PID.s that have not only this phenotype of increased risk of infection, but also have this immune dysregulation phenotype. And what I'm referring to here is the concept where there's abnormal liver proliferation and frequently autoimmunity APDS, of course, as an example of such a primary immune deficiency with immune dysregulation. In the next slides. I'll talk a little bit about this first program, but we're already moving forward on a second non APDS PID. indication, again, with encouragement from experts across the world to suggesting that we should study leniolisib in these populations.

Next slide, please. And what these experts are telling us is that there are many patients with clinical feature similar to APDS that have similar disordered PI3K. signalling, but don't necessarily have the PI3K. genetic abnormalities that we see in APDS. and that's signalling not surprisingly leads to the clinical manifestations that you see on the right. And you see that these are very similar to the types of things that we see with APDS mainly we see abnormal liver proliferation, so large lymph nodes, large spleens. We see this also in the gut. On top of that, there's the problem of autoimmunity, again, signalling the abnormal dysregulation in these patients' immune system.

We see GI disease, lung disease, the frequent infections, of course. And unfortunately, these patients also have a parental action toward developing early lymphoma. So there's clearly a high unmet need here. And not surprisingly, given that there is abnormal signalling that the symptoms you see there on the right are similar to APDS. The treatments that are being applied for these patients, such as rapid mice and an [MTR] inhibitor or other immunosuppressive agents have been also applied in this population. So overall, we see that there's a strong basis to study also in this group of patients. And you see some of the genetic abnormalities that are mentioned there, including the condition called ALPS cost by an abnormality in the fast gene CTLA4, PTEN.

And on the next slide, you can see a little bit about the work that we're doing to advance this program, and we're working closely with the team at the NIH. And this includes Dr. Rowe, who led the APDS clinical trial program at the NIH and Dr. [Uzel] now who actually was part of the team that led to the discovery of APDS. 10 years ago, and we're starting this Phase II proof-of-concept dose-finding study. We're starting at doses that we used in the leniolisib development program for APDS also starting at the 10 milligram dose. And as I mentioned, we're using out patients that have a number of abnormalities, including those listed there.

The primary goal, of course, is to look at safety and tolerability. And we're also going to be looking at pharmacokinetic measures and various efficacy measures and patients will receive doses for a number of weeks them and escalate. As we progress through the program. The goal is to be able to pick the best dose regimen for the Phase III study. And if we go to the next slide, we can see some of the populations that have already been characterized with these various genetic abnormalities.

And you can see here several large cohorts with each of the use different genetic forms of primary immune deficiency. And these large cohorts together tell us that there's a treatable population of approximately five patients per million across the world here. So we're when we put all of this together, you can see we're very enthusiastic about the potential of joint venture in APDS. as well as beyond [APPF] in these various abnormalities that have clinical features that are similar to APDS.

And with that, I will turn it over to my colleague Jeroen to talk about our financials.

Thank you very much Anurag. And next slide, please. So in the first quarter of 2024, the revenues increased by 31% to USD55.6 million, and that's the comparison to Q1 of last year. And this is driven by both the US commercial launch of Joenja and revenue growth of Ruconest refinish revenues increased by 8% to $46 million compared to Q1 last year. And Joenja or leniolisib revenues were $9.6 million, and that's a 21% increase compared to the fourth quarter of last year. So overall, we are well on track for 2024 to hit our total revenue guidance, which is between USD280 million and USD295 million or 14% to 20% revenue growth.

Looking at gross profit, it increased in line with the sales increase and gross margin dropped slightly and that was because of a nonrecurring inventory impairment of just over $2 million. Looking at OpEx went up compared to last year's first quarter, but went down. If I compare it to Q4 last year as we already indicated at the time. So this increase versus last year was planned and we are increasing the OpEx to support the launch of some of Joenja in the US, but also preparation for the launch outside of the US.

And the operating loss because of the increase in OpEx increased from USD13.7 million to USD16.3 million in the quarter. And the net profit remained fairly stable, increased by $9.2 million, and that is compared to the operating loss is due to better net finance results in the quarter. Our overall cash and marketable securities position went from $215 million to $203.5 million as a reduction of $11.5 million, and that is on the back of mainly negative net cash flow from operating activities of $7.6 million.

On the next slide, we see the revenue breakdown by product and geographic segments and just focusing on Ginger, for the first quarter, we saw a $8.5 million revenue in the US from $7.9 million in Q4 last year, and we see a $1.1 million outside of the US and that was $1.3 million in the fourth quarter last year. And this is sales from named patient programs. And if you look at the overall part of Joenja in the total revenues at $9.6 million, that's now 17 one 7% of total sales. And obviously last year was nothing. And we and we expect that share to have to go up going forward.

So next slide, some more perspective on the OpEx. As I said, the OpEx went down from last quarter by around $10 million. And the OpEx really reflects the continued investments in Joenja in the US and the launch preparation and ex-US. And we also increased investments to expand the leniolisib franchise. So think about the paediatric trial and new indications that we are working on them that are unwrapped mentioned. And we also increased payroll costs, and that is because of a general business growth.

With that, I would like to hand over to Simon for the for the outlook for the remainder of the year.

Thank you, [Rune]. And yes, I'm happy to present you with the next slide, the outlook for '24. As you heard in the beginning, we gave a guidance and we continue to give guidance between $280 million and $295 million for revenues for this year, which means between 14% and 20% growth with, of course, quarterly fluctuations as expected, dementia you heard about the continued progress in finding the additional APDS patients in the US market, the patients that are already identified, of course, but also supported by the family tests and the systematic family testing that we have embarked upon and the first results of the VUS validation efforts.

And, of course, subsequently converting those patients to paid therapy, albeit you also heard from, of course, from and rack density maze experiment, which will provide the definitive answer of the full definition of APDS will report at the end of this year. So in other words, we expect a significant inflow of patients in the US from that from that experiment that will allow the overdose of more than 1,100 patients with the with VUSE.

Then you heard about the ex-US., increasing revenues from the commercial availability through the named patient program, which we expect to continue to increase during the remainder of this year on the clinical trials, the paediatric trial and of course, Japan trial continue. And we also expect the regulatory action you heard this year from the various jurisdictions where we have regulatory files that are under review. And we're very excited, of course, and expect in the very near future to be able to announce that the Phase II proof-of-concept clinical trial in PID with immune dysregulation is actually will be started to significantly expand our commercial potential of leniolisib. What you heard on [Rock], you're outlining the details about.

And then last not least, we have an active business development group that looks for primarily in-licensing opportunities, but also we look at acquiring opportunities that are in clinical stage of development or later on in those areas that are mentioned here on the slide, immunology, haematology, respiratory and gastroenterology, preferably. So in other words, we have a very busy remainder of the year ahead of us. And we look forward, of course, to updating you on that later on. But that's to switch over now to the operator first, because there may be some questions that we happily answer. Over to you, operator.

(Operator Instructions)

Christian Glennie from Stifel.

Thank you and thanks, guys for taking the question. Three questions, please. First one will be on and Joenja in the US. Just to understand a bit better. The sort of potential moving parts here in terms of patient numbers, you talked about term 83 being on treated therapy as of 31st of March, but that compares to 81 at the end of December. So it's just a net two additional, but maybe this does some additional patients that have that have come on, but then some have dropped off.

And then maybe some comment around the duration of treatment that you've seen so far, given that you've now have some patients potentially been on it since since it was launched 12 months ago, and so just a better understanding of the patient dynamics there and what to expect for the rest of the year?

Steve, would you have would you be so kind of intuition programmatic.

So yes, the So we actually were they the ones we added four group patients in the quarter. There were two, though that dropped out. One was post transplant or 40 that patient passed away unrelated to Joenja and then secondarily, a patient with an unknown adverse event. So the net of that is 83. We also diagnosed or had diagnosed 50 more patients during that quarter. And those are currently being processed obviously and will be additive to the current patient load. So as things stand right now around our outlook is much the same. As Simon said, we were on track to get to where we need to by year end.

I think the offer is that. Thanks, Steve, for that. I think you would all be sort of a ultra-rare therapies. You will see, of course, especially in the beginning, you'll see some lumpiness in the sales, right? That's why we say quarterly fluctuations question.

Yes. Okay. Thank you. And then I have you got to I mean, is the working assumption that the majority of patients continues to be on therapy? Or if you've got an average duration of treatment that you can quote at the moment?

I think you're you're right. I mean, people stopping therapies are is far and few between what we see right now unless you want to say something about that?

Yes. Thanks, Simon. I Christian. We have we see continue very high compliance with the product, and we've seen that throughout the clinical development program and we see are infrequent discontinuation.

Okay, thank you. And then and then second one would be on your Linio Joenja in Europe. I'm flagging ongoing review with the EMA and are expecting a CHMP. Just wanted to trying to understand a little bit as much you can tell what some of these issues could be or overlay to do you have any outstanding issues there. And when you say you expect to be on the agenda for May is that's not necessarily the same thing as being up for an opinion. And may I just want to clarify what what your expectation is for the May. We may committee.

Anurag would you be happy to answer my question?

Sure. So we do expect to be on the CHMP agenda for their meeting at the end of May on the MAA. So that's our expectation. Of course, we'll wait for that. And CHMP feedback to confirm that.

Okay. So we should be expecting that you and that's your expectation Joenja will be upfront opinion in May?

That's correct.

And then just finally, on the named patient rollout of the [$1.1 million] you said that will continue to grow. Can you give us a sense for the growth there through the rest of the year and also kind of the number of patients and sort of the prices that you're getting for these patients? Thank you.

Steve, would you like to comment on that?

So that the prices are generally in line with the US price, sometimes with a slight discount to that. So generally in that ballpark, in terms of numbers, we don't necessarily forecast MPPR just just because that's driven obviously by the doctor and their discussions with both the patient and local authorities in country. But we would expect to see the product is becomes better known and the effect that it has will have a positive effect on patients becomes more widely understood that as we await approvals, more patients do benefit from that. But there isn't a specific target as such that's very much data driven.

Yes. Okay. Thank you.

Sushila Hernandez, Kempen.

Yes, thank you for taking my question also, one on Joenja. Yes, and a patient finding. And we see that there are 15 diagnosed patients in Q1. So how many of these patients do you expect to be converted to base stations? And also on operating expenses, are these the levels that we can expect throughout the year? Or are you foreseeing any increases or decreases compared to this quarter? Thank you.

Okay. So may I suggest Stephen Ju you answer the first one. Is that right?

Yes, absolutely. So thanks for the question that we expect the majority of those patients, if not all of them to be converted on to paid therapy. The we have not as yet had a out of rejection. So I would expect in the course of business, all those patients tools come online.

And would you like to comment on the on the operating expenses, Europe, what do we expect for that? You're probably on mute.

You thought, as I said last year on the OpEx, whether it was in the Q4 was $73 million that we expected it to go down. It has gone down now. And I would expect it to be slightly up in the next quarters because we keep investing in Joenja both in the US and ex-US. And so I don't expect a sharp drop or anything in OpEx in the next next few quarters.

Does that answer your question, Sushila.

Yeah. Thank you.

Joe Pantginis, H.C. Wainwright.

Good morning or good afternoon, gentlemen. Thanks for taking the questions. So a couple, please. So at the I just want to start at the end of your unwritten comments today because more on curiosity, I mean, obviously it didn't it's not impactful of your investment case, but you did disclose that on OTL one oh five with orchards being discontinued. So just curious if two things is there anything on technical or science that impacted the decision to discontinue for the program? And are there any payments either way for the termination? And will you be potentially looking for an additional or an alternative gene therapy approach for the future?

All right, Joe First No, no significant payments. Secondly, yes, there was always a high hurdle, of course, involved in this high technical hurdle. And when you look at it, it's associated with the both the ability to generate sufficient C1 inhibitor protein and by means of the blood organ S1. And then, of course, the are the nontoxic conditioning regimen developments. So those were the high hurdles. And then of course, you know, And last not least, but very importantly and we at the time we did not have the opportunity to develop, but that's the main reason to develop leniolisib we were not expecting that to be able to develop the Neos for two subsequent indications.

So we're now about to kick off that Phase II study for leniolisib for the next indication you've heard from and record is a very, very significant indication, which is a fairly nearby the market compared to also a product like OTI. one oh five. Obviously, no competition around with a long exclusivity guaranteed for leniolisib. Secondly, we are looking at an even more and bigger PID indication for us going forward. So in other words, we have a lot of opportunities now that are more nearby, more derisked and without any competitive threats here. So we'd say appeal given all the things together. But it is the best way forward to focus ourselves.

Now on this with regards to our internal portfolio and of course, to continue to look for leveraging the infrastructure to commercial infrastructure further, we are active in licensing slash acquisition on a quest. So I hope it's a bit long-winded. I hope I answered your question and Joe.

No, absolutely. Thank you. And then I'm looking at sort of a two-pronged question and how would you describe sort of the first quarter impact with regard to insurance resets that are usually expected on? How much did that impact at least just for the first quarter to be able to get back on trajectory? And secondly, how would you describe the balance because obviously, it's very nice to see the continued addition of new physicians to the program and on refill rates? Thanks a lot.

Yes, yes, of course, it's always part of the lumpiness or the first quarter is always part and parcel of that the renewals of the year of the prioritization. But let's just go to Steve give a bit more insight in these things.

Right, Steve, as you heard, Joe, so actually the things went well, Joe, as you know, we've been doing this now for a number of years. So we were able to prepare in Q4 and the prior authorization prioritizations in Q1 actually went pretty smoothly and we have completed almost all of them by the end of February. Now the what complicated last year was some issues, as you know, that were external issues that hit the market for government patients. We saw the impact declining quite significantly this year is pushing. Other pockets also came down for Medicaid in the Medicare space. And certainly for us, it was a it was a significant decline in impact. So overall, I would say Q1, while you expect lumpiness in Q1, it was pretty successful reauthorization period for us.

Excellent. Thanks for all the details, guys.

Pleasure Joe.

Hartaj Singh, Oppenheimer.

I'm great. Thank you and thanks for the questions. I just have a couple of really nice launch going on on with Ginger, but I just wanted to kind of go back to a previous question on the first quarter fluctuations, two years in a row now we've had them and they seem to be pretty extreme. I mean, is it our other companies, they talk about payment into government programs. There's patient system programs that are set or I mean, what exactly happened in the first quarter where you have this pretty large drop-off from the fourth quarter and the first quarter seems mostly looking to sales. And then is that the expectation going forward should is that the way we should model this going forward in that in future?

First quarters on, you know, on a quarter on quarter sequential, we should expect a pretty significant decrease in new equipment sales and then that will pick up going on later. I mean, is that the way to think about it? So that's my first question. I just got a couple of others thinking.

Yes, I think it's been the case, right for all those years and was aggravated last year by this by the special situation there. But it seems to be the case. Why do you want to comment any further on this? Stephen.

[They show mornings]. So I think it's certainly the case that in most key ones you've seen over the years, reconnect sees a slight decline due to the reauthorization reauthorizations that most of our patients in that period of time. And that does affect most companies last year was exacerbated by the impact to government patients that was externally. It was it affected the whole HAE space that came down significantly this year as patient out of pockets declined.

So we saw about half the impact that we saw last year next year and that stabilizes completely. I think one patient out of pocket is coming down to around $2,000. So I think you can say by the time we get to next year at steady state. So yes, perhaps we should expect a decline as we always have year on year, but I don't expect what's happened last year and this year to continue. That's the result of or a specific event affecting government patients.

Yeah. No, Stephen, that makes sense, and we've heard that from other companies also, I think the IRE inflation Reduction Act has exacerbated this first quarter fluctuations. And the other question I would just have is on OpEx. I really like all the color there, but let me put the question asked previously them put it another way which is that you're expecting your guidance suggests a pretty significant increase in revenues this year. And is OpEx expected to grow at the same rate? I mean, or can we hope for some operating leverage, which would mean OpEx growing at a slower rate than revenues. And I've got one last question I have.

Yes, you know, I think [Kieran] already commented on that and I talked about the still to be expected slight increase in the operating expenses for the coming quarters. Having said that, it's not the spectacular increase anymore before because now we did the US launch. Of course, it was a that's a that's a scary capital intensive. On the other hand, we continue to invest in all those things in the US. In the US market. And of course, we are preparing for, as Jan was already alluding to of the preparations for the launch of new engine outside of the US and in addition to that, you also see that gradually R&D costs will not spectacularly, but will continue to go up as cloud because of the fact that we are starting our clinical trial programs for them for leniolisib into the subsequent indications.

So all in all, we're not a we're not at this point in time, of course, aiming for for profitability per se in this year because it's a lot is still low share, right? And it takes time and you already heard that, for instance, you know, the deleverage. I think the real leverage, if you look at the patient growth in EBIT, as you heard Stephen say, there that you are that that that's a conclusive view. S may have experimented and direct was talking about will or should be bringing a very significant bolus of patients to the US.

In the US market towards becoming available for pet therapy next year. So this is typically when you have a new disease is not fully described. It is typically when you are dealing in ultra rare diseases that it takes time and it takes a lot of investment, but eventually it will be a very, of course, profitable operations. I hope that answers your question a little bit, Hartaj.

Yes, no, absolutely. I mean, it's in line with what you've said before. Also previously, Simon, just wanted to get more color around it. My last question is just on some on the Phase II design. I'm Rod, you might have mentioned this already, but can you just kind of walk us through roughly how long would it take for you to sort of get all the sites open and recruiting them? You know, when when when could we see essentially what I'm trying to get to is when could we see a sort of a readout? Would that be a 2025 event or 2026 and thank you for all the questions.

Thank you Hartaj. Yes. So we have this this next Phase II dose finding study is being conducted at a single center and that's at the NIH. So with lab and the fact that they've we're anticipating 12 patients in this study, this is a center that has actually already identified, which patients they dissipate being able to enroll. We believe that we'll be able to enroll the study and relatively rapid fashion once we get going and we expect to be able to read out the results probably into the in the course of 2025.

Great. Thank you all for your time.

Alistair Campbell from your Royal Bank of Canada.

Thanks so much for taking the questions. I've got. So three, if that's okay. I'm just first of all looking at Juenger. I mean, obviously, we've seen more diagnoses through Q1, but we haven't seen progression in terms of patients. I just want to ask that you get a sense of that mean just check, we're not seeing an underlying dynamic here where perhaps what you've done in the first instance kind of move it up the most severe patients and maybe now we're moving into patients diagnose, but then how close this is rare disease and that potentially harder to pick up some maybe some commentary on that in terms of what's happening with severity in patients on drug.

And then if I do some quick mathematics mission, you had about 80 patients paid therapy through the courts, and that was reported to U.S. number based on the whack and a chunk higher than reported sales I'm sorry, indicate something like a 25% in the system. Is that a good proxy for how much discounting that might be from that from the White price in the system.

And then finally, just on the PID. trial, is there any reason to think that PID.s need a different dose from a PDSMNG. It's stronger suppression of the pathway. Just any sort of feedback about the interest? Thank you.

Okay. Let's maybe start. Thanks, Alister. Let's maybe start with the two questions were asked about the severity and the PID dosing unwrapped. Would you like to comment on that?

Sure. So I think I'll answer the first comment is correct that the patients that we had initially were able to convert over to paid therapy. These were patients, of course, that were in the clinical trial program in the expanded access program. So there was, of course, a bolus of those patients and many of those patients were quite severely ill.

Now APDS in general is a serious disease. So there's you know, there aren't a large number of, let's say, a symptomatic patients that were floating around out there with all of these patients are sick. Most of these patients are on IG replacement therapy, for example. So this is no, this is a serious disease and progressive disease. So I think it's just a matter of continuing to reach out to these doctors and educate them as well as patients about their condition and and the potential effects of Joenja.

Onto the question about the dosing in the in this study as well as any future studies. And I think it's really an open question. We're starting with a lower dose than we have approved for Joenja. currently sit, we're starting at the 10 milligram dose, which is the same dose that we used initially with APDS. And we'll progress these patients through based on everything that we know so far about the activation of the pathway in these patients and measurements that have been done about that activation relative to APDS patients, we feel like we're in the right dosing range. So we don't believe that we're going to need a higher dose and so call suppress the pathway, but really trying to normalize and sort of balance the pathway. I think that that's probably a better way to think about it.

Okay. Thanks. And then maybe you do you want to comment on on Alex's question about the year, the discounting or the absence of it in Joenja?

Yes, absolutely. So basically, it's not just discounting like in other directors, mainly because of the mix with the Medicaid Medicare patients and but mainly Medicare. And so we did have for that reason a discount I have around 12%. Does that answer your question, Alastair?

Yes. And there's I don't know all the discounts that Allison that's going to breakeven, is that broadly what we should be thinking about counting going forward?

Do you think the mix will change script growth? It really depends on the patient mix. So it is very difficult to say. But other than that, that it's been relatively stable so far you should think should realize assets. It's a relatively young population that we're treating right here time in this case.

Okay. Thank you.

(Operator Instructions) There are no further questions at this time. I would like to now to turn the conference back to Sijimen on the brace for closing remarks.

Thank you, Sandra. Yes, thank you very much. Yes, so you heard of our total revenue guidance continue to be between two 80 to 95. You heard about the progress of finding the additional APDS patients in the US and outside of the US. Of course, and then bringing also relevance a relevant part of the revenues for Joenja. You heard about the expectations of towards the big effort is ongoing during the remainder of the year.

To clarify the full description of the disease by means of the Maeve experiments to So which will we expect deliver a significant new bolus of patients next year becoming available for therapy? Obviously, the clinical trials are ongoing and especially here, the pediatric label expansion trial progresses very well. And that's all that the trial was for 11 year olds said, has the majority or the vast majority to pediatric patients in it and that that, of course, will be delivering a significant bolus of patients.

In addition to that, you heard about the regulatory actions that are ongoing in the various territories outside the US and where we expect to see some of some progress there continuing. And then, of course, last but not least, we're very excited about the start of our Phase II clinical trial proof-of-concept trial in PID. with a mean immune dysregulation that will very significantly expand long-term commercial opportunity of leniolisib And very lastly, and we continue to look for in-licensing opportunities of clinical-stage rare disease opportunities or to be either in-license, preferably or acquired.

So with that, I would like to all thank you for being present at our at our conference, and we look forward to updating you on our next call, which will be our half year results in the beginning of August. Thank you very much and goodbye.