PTC Therapeutics Inc (PTCT) 2015 Q1 法說會逐字稿

Good day ladies and gentlemen, and welcome to the PTC Therapeutics Q1 2015 earnings call. At this time, all participants are in a listen only mode. Later we will have a question and answer sessions and instructions will follow at tht time.

(Operator instructions)

As a reminder, this conference call is being recorded. I would now like to turn the conference call over to Emily Hill. Please proceed.

Thank you. Welcome to today's conference call to discuss first-quarter 2015 earnings results and the commercial launch of Translarna.

Before we start, let me remind you that today's call will include forward-looking statements based on current expectations. These include statements about our future expectations regarding clinical development, regulatory and commercialization timelines, the potential success of our product and product candidates, addressable patient populations, and financial projections. Actual results may differ materially from those indicated by these statements as a result of a variety of risks and uncertainties, including those discussed under the headings Special Note Regarding Forward-looking Statements and Risk Factors in our most recent Form 10-K, which is available from the SEC or our website. Such statements represent our judgment as of today, and PTC undertakes no obligation to publicly update any forward-looking statements except as required by law. With that, let me pass the call over to Stuart.

Thanks, Emily. Good afternoon. Thank you for being on the call today. We're off to a strong start this year.

We have had several significant accomplishments since our last call two months ago. We continue to see growth in our launch of Translarna, the first treatment for Duchene muscular dystrophy.

We have updated the share on our SMA program, which was recently highlighted at the American Academy of Neurology. Additionally, we recently moved our cancer stem cell program targeting BMI1 into the clinic. I will discuss each of these points during today's call.

Let's cover Translarna first. We're proud to have launched the first approved treatment for nonsense mutation Duchene muscular dystrophy to patients with this devastating disorder. Translarna targets the underlying cause of the disease.

As a reminder, Translarna was approved by the European Medicines Agency last August. We remain committed to bringing Translarna to patients as quickly as possible.

We assembled a team with substantial experience commercializing product in the ultra-orphan disease state. We have submitted pricing and reimbursement dossiers in key European countries.

The rollout through the remainder of 2015 will be staggered on a country by country basis in Europe and outside of the EU. I'm extremely pleased with the continued ramp-up we're seeing in our commercial launch for Translarna as we remain highly focused on bringing this new therapy to DMD patients across Europe, as well as numerous other countries around the world.

As of April 30, we now have 82 DMD patients on commercial Translarna therapies through either reimbursed early access or commercial sales, almost double the number of patients we reported at the end of February, a little more than two months ago. We have been shipping product to patients throughout Europe, including Germany, Spain, France, Italy, Greece, and most recently, Austria.

Outside of Europe, we're shipping product to Turkey, Israel, and Columbia. Feedback from the field so far remains positive. We're pleased to have seen such a strong reception and uptick in the last nine weeks.

As a reminder, during our planned 2015 quarterly calls, we intend to continue providing you with a number of patients on commercial Translarna therapies. Beyond 2015, we will evaluate the metric that will be most useful.

We've also begun building out our US commercial infrastructure in anticipation of a Translarna launch in the first half of 2016. We recently hired Eric Pauwels as head of commercial operations for the Americas. Eric brings a wealth of commercial experience, having launched multiple ultra-orphan disease products in the US and internationally. We are pleased to have him on our team.

As a reminder, we began submitting a rolling NDA to the FDA for Translarna for the treatment of nonsense mutation DMD in December of last year. This will allow the FDA to review the majority of our materials ahead of our submission of the data from our confirmatory Phase 3 ACT DMD trial from which top-line results are expected in the fourth quarter this year.

While we are very excited about the current commercial opportunity for Translarna in DMD, we are equally focused on bringing Translarna to patients in other indications with high unmet medical need, as well. As you know, Translarna is also advancing in nonsense mutation cystic fibrosis.

We initiated a second phase 3 trial with Translarna ACT CF in June of 2014. Enrollment is on track to be completed by the end of the year. We anticipate results from ACT CF will be available in the second half of 2016.

Modeled after our successful DMD experience, we intend to apply for early approval in Europe, once ACT CF is well enrolled. We anticipate submitting this application in the second half of 2015.

Because Translarna is already approved in Europe, the CHMP review process may be completed in as little as three months. This could mean a potential Translarna launch in CF across Europe in 2016.

Given Translarna's mechanism of action, it has the potential to address a wide array of genetic disorders caused by a nonsense mutation. On average, 11% of every monogenic disorder is caused by a nonsense mutation.

There are now over 30 publications demonstrating Translarna's activity in a number of preclinical nonsense mutation disease models. We have been reviewing these publications as part of our lifecycle management strategy, with aims to realize Translarna's application as a precision-based medicine with the potential to treat patients across an array of genetic disorders.

We are pleased to announce that the next indication we will investigate with Translarna is nonsense mutation aniridia. One of the 30 publications that I referenced earlier highlighted Translarna's ability to promote nonsense mutation readthrough in an aniridia mouse model.

Aniridia is a genetic disorder caused by a mutation in the PAX6 gene which occurs in about 1 in 60,000 births. Congenital aniridia is a rare and devastating disorder of the eye resulting from disruption in the development of multiple parts of the eye including the iris, cornea, lens, retina and optic nerve.

So new and important pre-clinical results using Translarna in the nonsense mutation PAX6 aniridia mouse model were reported yesterday, May 3, at the Association for Research in Vision and Ophthalmology conference. In this model, Translarna inhibited disease progression, reversing the congenital ocular malformations in the cornea, lens and retina and restoring electro responses of the retina measured using electroretinography. We plan to initiate a phase 2 proof of concept study with Translarna in aniridia before the end of the year.

This year we look forward to advancing other Translarna clinical programs as we investigate additional indications. As reminder, we're initiating the phase 2 proof of concept study in Translarna in MPS1.

Translarna is a small molecule which can cross the blood brain barrier. Existing treatments for MPS1 do not address the central nervous system, manifestations of this disorder, which can be quite severe. We expect to have data from the phase 2 study in MPS1 by the end of the year.

We also continue to evaluate additional indications for Translarna. We use multiple metrics to prioritize indications, including those with high unmet medical need, clinical endpoints for study design, and established animal models. It is our goal to maximize Translarna's potential as a product in the pipeline and bring Translarna to as many patients as possible who suffer from rare and neglected disorders.

Let me now shift to the SMA program, which is a partnership with Roche and the SMA Foundation. SMA is a genetic neuromuscular disease caused by missing or defective SMN 1 genes, which results in reduced levels of the SMN protein.

The analogous SMN2 gene predominately generates a shortened messenger RNA due to alternative splicing and only produces small amounts of the SMN proteins. Insufficient levels of SMN proteins are responsible for the loss of motor neurons within the spinal cord, leading to muscle atrophy and death in infants and toddlers in its most severe form. It is estimated that this devastating disease affects one in every 11,000 newborns. There are no market therapies for SMA.

RG7800 is an orally available small molecule being investigated for its ability to modify the splicing of the SMN2 RNA towards the production of full-length messenger RNA. As you may recall, preclinical studies in the animal models of SMA demonstrated that the full-length SMN mRNA led to an increase in SMN proteins with significant benefits on survival and motor function. A tremendous amount of effort and resources has been put into the SMA program by all three collaboration partners.

Recently, results were presented from the Phase 1study in healthy volunteers at the Emerging Science session at the annual meeting of the American Academy of Neurology. These results showed a dose-dependent effect of RG7800 on SMN2 splicing, demonstrating proof of mechanisms.

These data are meaningful because both SMA patients and healthy volunteers share the same SMN2 genes. After a single dose, there was approximately an 80% increase in their full-length mRNA production. As a reminder, our previous a published data in animal models of SMA demonstrated restoration of full motor functions and survival at SMN proteins levels below those in healthy animals.

Based on the Phase 1results, Phase 2 multidose study MOONFISH was initiated last November in SMA patients. This study is enrolling up to 64 patients with one daily oral dosing for 12 weeks.

The primary objective of this trial is to investigate the safety and tolerability of RG7800 while also measuring pharmacokinetics, SMN protein production, and changes in SMN2 mRNA levels. Exploratory endpoints also included muscle and nerve function measurements.

As you know, as part of every drug development program, you also perform preclinical and safety and toxicology work to support the chronic use in patients. There are recent data from RG7800 on this topic.

In the first cohort of MOONFISH, dosing has been successfully completed. RG7800 was well tolerated, and preliminary review of the blinded data indicates substantial increases in SMN2 full-length messenger RNA. These data are in line with the observation in healthy volunteer Phase 1study.

Recently, long-term monkey data have shown findings in the eye had drug concentrations above those explored in patients to date. While no adverse eye symptoms or signs were observed in the clinic, as a cautionary measure, we have temporarily suspended dosing of additional patients while we further evaluate this result. Let me summarize.

The safety, tolerability and pharmacodynamic data observed with RG7800 so far in the clinic are encouraging. The preclinical findings in the eye have not been observed in humans and activities are ongoing to fully evaluate this finding and confirm our next steps for MOONFISH. As you know, learning about safety and dose optimization is a normal part of drug development.

Let me turn next to our cancer stem cells program targeting BMI1. As we have discussed in the past, our compound PTC596 reduced the level of the BMI1 protein in preclinical models. BMI1 is upregulated in the tumor stem cell population and is an important component of the complex that allows cancer cells to become resistant to chemotherapy.

I'm very proud to have a fourth internally discovered program at PTC entering clinical development. PTC596 recently entered into a Phase 1 study in advanced cancer patients with solid tumors. We're excited about this program and will keep you aware of the progress as we move forward.

Finally, let me briefly discuss our antibiotics program. We have developed a platform that has identified new and novel chemical entities which target multidrug-resistant bacteria.

The first compound from this platform is an antibiotic. PTC672 has entered IND enabling studies for treatment of drug-resistant gonorrhea. This is a new and novel chemical scaffold with a unique target that is highly selective for the gonorrhea pathogen.

It is great science and reflects the strong research platform that is thriving at PTC. We look forward to sharing more with you about these programs throughout this year.

With that, let me turn it over to Shane. Shane?

Thanks, Stu. We finished the quarter with $280 million of cash and marketable securities on our balance sheet and no debt. We believe that this cash position should be sufficient to fund our operations through late 2017.

Here are the financial highlights for the 2015 first quarter. Beginning this quarter, we are now booking Translarna revenue from our commercial and reimbursed early access sales ex-US on an invoice basis. As you may recall, for the first few months of our launch in 2014, we, like many companies during a launch for their first product, had only been booking Translarna revenue on a cash basis when payment was received.

We have now established a pattern of collectibility from numerous countries where we're shipping Translarna, which allows us to begin recognizing revenue upon product shipment and invoice to the customer. As a result, and in addition to recording revenue for product shipped in the first quarter of this year, we are now booking a true-up this quarter for revenue that we had deferred in 2014 under the cash accounting methodology.

We're pleased to report that in the first quarter of 2015, we recorded $5.1 million in commercial Translarna product sales. $3.7 million of this was from sales occurring in the first quarter, and the remaining $1.4 million was from sales previously deferred in 2014 that we are now recognizing.

Total revenues for the first quarter of 2015 were approximately $7.5 million, which compares to the first quarter of 2014 of approximately $9.2 million. In addition to our commercial products sales, we recorded $2.4 million in collaboration and grant revenues this quarter. The $9.2 million recorded in Q1 of 2014 had included a one-time milestone payment from Roche of $7.5 million for the Phase 1 initiation in the SMA program.

R&D expense for the first quarter of 2015 were approximately $27.9 million, which included $4.7 million in non-cash stock-based compensation expense. And this compares to $15.9 million for the same period in 2014, including $1.9 million in non-cash stock-based compensation expense. R&D expenses increased year over year as a result of increased clinical development and supply chain activities in support of the Translarna launch, as well as in conjunction with our expanding clinical stage pipeline.

SG&A expenses were $17.6 million for the first quarter, including $5.1 million in non-cash stock-based compensation expense compared to $7.5 million for the same period in 2014, including $1.8 million in non-cash stock-based compensation expense. SG&A expenses have increased year over-year as the result of the growth we are experiencing associated with our commercial activities in support of the launch of Translarna across Europe and other regions. Our organization is growing across many roles, both for the European launch activities as well as in preparation for a US launch in the first half of 2016.

Overall, the Company reported a net loss of approximately $37.9 million for the first quarter of 2015, compared to approximately $14.1 million for the same period of 2014. We currently have 33.9 million shares issued and outstanding, which include 0.4 million shares in restricted stock grants.

Joining us for Q&A is our Chief Commercial Officer Mark Rothera. Operator, let us take the first call please.

Certainly.

(Operator Instructions)

Simos Simeonidis, RBC Capital Markets.

Hello guys, thank you for taking the question. I will start with Shane, congrats on the progress on adding I guess 40 patients between the end of February and the end of April, 42 to 82. I was wondering, Shane, whether you can help us get an idea on the price per patient, or the revenue per patient I should say, or the $3.7 million in actual revenue for Q1, roughly how many patients that corresponds to?

Yes. Thanks for the question, Simos. I think we're happy to announce the 82 patients that we had on reimbursed commercial or early access therapy as of April 30.

Obviously that does not necessarily correspond exactly to the revenue that we recorded for the first quarter, which is ending March 31. And I think our guidance remains the same in terms of at least how we model our revenues internally is about a price of $300,000 on a net per-patient per-year basis.

So that's the number we should still be looking at? That has not changed in any way?

No, that has not changed. That is consistent.

Okay great. I will ask one more and jump back in the queue. This one for Stu.

On the SMA, or the SMN rather, news that you disclosed today, can you first of all tell us what the eye finding is? And maybe talk about the order of magnitude higher than the doses that you are seeing that this was observed in preclinical versions of the doses the have tested in humans? Basically how much higher was it in animals? In monkeys, you actually disclosed that it was in primates -- versus the doses that has been tested in humans?

Yes, thanks for the question. It was an exposure that were far higher than what we had in humans. We haven't actually disclosed the precise dose, and it's important to remember really that the concentrations that patients were dosed at were below this.

And I think the other point is really that it is a nonclinical finding in the eye. And I think really from the point of view of what we saw was at those doses which were below that, we were able to see splicing. And as we said, it was substantial splicing comparable to what we saw in the Phase 1 studies.

So we felt pretty good that we're seeing on target mechanisms of action. And really what we're doing now is just evaluating this eye finding so that we better understand it.

And Stu, was this something that was communicated the FDA or EMA? And was the decision made at the request or the behest of agencies? Or were you and Roche just acting on your own to suspend dosing?

Yes, so no patients were affected. Really in the abundance of caution, we decided to suspend the patients in the next cohort. No patients were above the exposure range where we saw this.

And so, we will be -- as part of the process, we will be reporting the nonclinical findings to the regulatory authorities as is typical in these processes.

All right. Thank you very much for taking the questions.

Sure.

Alethia Young, Deutsche Bank.

Guys. Thanks for taking my question. A couple. One, just to follow-up a little bit more on the SMN.

Do you have any color on maybe the timelines or the additional work needed? And then, does this affect the infant study as well? And that is the first of the questions.

Yes, thank you for the question. It's a good question. As you know, we just recently learned this so it is really too early right now to give you any detail on the timeline and such.

And no of the cohort one -- or type 1 patients were dosed. And obviously, these are infants. So in an abundance of caution, as we go ahead and understand this finding, and evaluate it, we will come back and then give you more clarity on the timeline.

And then on the DMD and the World Orphan meeting that happened, I know you guys had some presentations there and I know a lot of people did not get to attend, but if you could highlight maybe if there were any relevant takeaways pertaining to maybe findings and takes around the ongoing DMD trial and design there?

Sure. So, actually we had a couple of our folks, both Mark Rothera and [Twin Ung] both going to that meeting and actually presenting our experiences as a consequence of being really the pioneers in this. So maybe I will ask Mark, do you want to give a little bit about what you found at the meeting?

Yes, I think the main goal of that presentation was to share with the broader community and illustrate what it is to bring a new drug which is a new chemical entity with a novel mechanism action, which is also the first to pioneer a route to market for a disease like Duchene muscular dystrophy, the kind of learnings that you have along the way. And to illustrate that story and also demonstrate that based on that learning, how that helped us really define that ACT DMD Phase 3 trial, confirmatory trial that we're currently undertaking. So it was more of a general talk to that audience.

Great, thanks, guys.

Thank you.

Geoff Meacham, Barclays.

Good afternoon, guys. Thanks for taking the question. Have got a couple. One on Translarna.

I don't know if you can -- I know it's early in the launch, but maybe give us some segmented data for example, maybe geographic breakout, and again, what you have seen so far. It's early, but the persistence rates will be helpful.

So maybe just more detail on your commercial experience thus far. And I have a couple of follow-ups.

Okay, thanks. Clearly were very pleased with the positive reception that Translarna is getting. I think as Stu outlined earlier, it is now being reimbursed and shipped to nine countries. So we're very pleased to see that.

With respect to compliance, when you think about this high unmet medical need, which is very good and strong compliance for a drug of this nature. But I think it is still clearly too early and premature to give you long-term guidance where that would be. But clearly very happy at this point.

Got you. Okay. And then, for SMA, I was not clear if there was really a mechanistic basis for what you guys have seen in the eye? Have you picked up any toxicity and other assays the guys have done? Or is this a relatively new finding?

And then, just wanted you guys to talk a little bit about maybe what you can disclose as the next steps as you interact with the US and European regulators? Thanks.

Yes, sure, thanks Geoff, on that. Clearly, as is expected when you do development, it's a process of doing short-term, medium-term and then longer-term safety studies and you're gaining information. This is just part of the development process, and you gain and understand what you need to monitor and what issues might arise. And so this was a finding from a more long-term safety study.

And again, in the monkey model where we saw it in the eye, exposures that were above where we were in patients. And so I think what we need to do is try and figure out as best we can, what the potential mechanism it is and try and work on that and understand where the best therapeutic window is.

At the end of the day, I think what you always try to do with these things, and this is something we have been doing now for three years in the Company and working with our collaborators -- any you just do this in standard drug development -- is to identify what an appropriate dose is within the therapeutic window. So I think that's what is the goal of what we are turn to do is to understand what the safety finding is, see if we can better understand the mechanism and then understand what the appropriate dosing could be.

Okay. Thanks, guys.

Tazeen Ahmad, Bank of America.

Hey guys. Thanks for taking my questions. For Translarna, can you give us a little bit of color?

You did have impressive growth in patients on therapy from your February update. But in March and April, did you see acceleration in the number of patients in April relative to March? Or was it evenly distributed?

Also, can you give us color on the profile of the patients themselves in terms of age and maybe what their baseline walk ability is? And then finally, are doctors being selective in the types of nonsense mutation patients that they're putting on drug? Or are you finding that they're just prescribing it to any of their patients who have a nonsense mutation form of DMD?

So I think you asked a number of questions there. So I think that in the first quarter, you did see some pent-up demand from countries that have been waiting to come online. And so there was bonus, I think, affect.

And it is probably too early to give you direction on precisely how that is going forward, bearing in mind that for Europe, you're talking about the addition of multiple launches over time with multiple countries under that one regulatory approval. But clearly we're very pleased with the way it's going and stay tuned with regard to the future.

Our focus is the current label, which is patients aged five years and over who are ambulatory, and we're working very hard to make sure that they are identified and that they are going onto therapy rapidly. That is what the physicians are doing when they have found these patients. Once the ACT DMD trial comes out, we will be looking to seek a broader label in Europe and the US and on that basis enable more patients to get treated.

Okay. And then, just a follow-up for SMN. I think in the past you had indicated it may have been possible for the MOONFISH study to read out in the very late part of 2015. But given what you've just told us, is that less likely now? Do you think it could be well into 2016 before we see the data?

Yes, so I think -- thanks for that. It's really too soon to give you any real information on the exact development timeline. Of course, we are encouraged by the preliminary clinical data that we saw so far. I think the best we could say is stay tuned and we will update you as we understand that further.

Okay. Thanks, Stu.

Chris Marai, Oppenheimer.

Good afternoon, guys. Thanks for taking the questions. I was just wondering with respect to Aniridia if you could help us understand your choice of selection for this to be the next indication for Translarna.

Is there some commercial connection between the Aniridia indication from your sales force perspective and some synergies you could realize there? Or is this a potential opportunity to have reformulated therapy for the disorder?

And then finally, on that note, would you be looking at a reformulation for specific eyedrops or different dosing modality? Thanks.

Thank you Chris for the question. When we think about what are indications that we want to move forward in on Translarna, there are multiple things that we think about. For instance, the high unmet medical need, are the patients known in terms of their nonsense mutation, are there some preclinical data? Are there some endpoints that one could use?

So I think obviously that they will go to a valuable commercial perspective if you can show that. And I think Aniridia, as I think you've referred or was alluded to earlier in the call, there's obviously some very impressive preclinical animal results demonstrating Translarna's activity in this.

I think it was really based on that. I think what we're working on now is the clinical plan which we think would be in the sense of probably around a year study where we would be looking at both structure and function within the eye to look for changes within that. So I think A, it fits all the important criteria of high unmet medical need, something that we can measure and be able to move forward on.

Okay. And then with respect to the SMA program and the eye findings, I'm just wondering with respect to, again, how long the folks have been dosed, is this a finding that is in some way a result of drug accumulation in patients? Or is it to early to tell? And would those accumulations or those doses tested be related to the amount of drug onboard somebody who has potentially been dosed over a longer period of time? Thanks.

Sure, thanks. I think that's a good point. They were actually no findings of this sort in patients that we had observed. And these were at exposures in monkeys at higher concentrations than were ever given to patients.

So I think there is not an issue in terms of that. We're obviously exploring what the -- and I say we meaning the collaboration -- and try to understand some of the questions that you are asking.

But no patient themselves were put in any risk. And obviously I think one point is -- and this is something that you do in animal models, and you increase levels of dosing to identify those things that you want to monitor. This is one of the findings that we found. And obviously, I think the point -- and it was done in a long-term safety toxicology studies, so we are going to be looking at them.

And then I think the important point here is that we and Roche and the SMA Foundation are highly committed to this, and obviously this is such a clearly high unmet medical need that really our goal is to move forward, understand what happens and so that we can define what is the appropriate dose within the correct therapeutic window. So that's where we're at right now.

Great, thanks for taking the questions.

Anupam Rama, JPMorgan.

Hey, guys. Just a quick question on PTC596. The Clintrials.gov indicates patients in advanced solid tumors. Just wondering if you could give more specifically which solid tumors you will be focused on?

Yes, thanks for that. Obviously, this is our BMI program which is, just to remind everybody, it is an important molecule that is in this sense an important regulator of cancer stem cell growth. And reduction of this would lead not only to inhibition of tumor growth, but reduce the number of cancer stem cells. And we're very proud that it was recently added and entered into the clinic.

And really, this is predominantly safety and PK study, and it's really all commerce. So that's what we're doing right now. So we will have a pretty good idea of where the safety and where the pharmacokinetics or PK is.

Great. Thanks for taking our question.

Jason Kantor, Credit Suisse.

Good afternoon. This is Jeremiah in for Jason. I know that you have looked at RG7800 quite extensively in animal models and particularly in the two different mouse models. I was wondering, did you see any of this previously in the mouse models?

Also, when you did some pretty extensive preclinical work with the same mice, you did a transcript analysis to look for any changes in splicing. Were any changes in splicing consistent in transcripts that are important for eye development or eye maintenance?

That's a good question. We did not see these findings in any mouse model or even rat model, for that matter.

This was a monkey finding that was observed at exposure concentrations that were above those that were seen. And obviously, I think the compound itself was shown to be pretty selective, a small number of things.

So we will obviously be looking at that, as well as just looking at the overall effects to try and figure out what this is due to. But I think to put it in perspective a little bit, this is standard development process where you get a finding and you go stop and you take a look to find out what the issues are. So I think that is just where we are right now.

Okay. One more follow-up. As you know, with expansion of MOONFISH that was put on clinicaltrials.gov, obviously it was posted April 17. And I'm sure there's some negotiation there with the FDA.

In your [lialtin] enroll, babies are seven months or younger. Was this finding available to the FDA during negotiations? Or was this something that happened very recently?

This is a recent finding. So, this was something that we just recently uncovered. So it was not part of those negotiations.

Okay. One last question. I noticed that you started a nonsense DMD registry recently. Maybe, could you talk about this a little more?

Where are the geographic regions you guys are focusing on? Does it include the US? Also, is this part of your larger preclinical or pre commercialization efforts in the US?

Yes. So, I think registry, and I can have Mark talk a little bit more about this, is one of the standard things that one does, especially in an area that is an ultra-orphan drug when you are the first in ever to have a drug that was approved.

So ultimately, there are other questions and you want to follow to understand long-term benefits, and that is one of the roles of what the registry does for us. It allows us to collect data in a commercial setting, and that is what we plan to do.

So I think that we have been working in Europe to be able to get that. So we will be collecting data about Europe, but also, at the appropriate time, we would be doing so in the US. I think Mark, did you have any -- ?

Just to emphasize that this is going to be a global initiative, that we're working closely with the community, [Treden] MD and other umbrella organizations because we are also helping the whole DMD field really elaborate a disease area registry which also incorporates product registry information. And I think as Stu said, I think this is extremely helpful in a very rare disease to be able to produce long-term outcome data, which is useful when you are looking at it from a lifecycle perspective.

Great. Thank you for taking the questions.

Thank you.

Yaron Werber, Citigroup.

Hi, this [Kumal Hussein] for Yaron, thank you for taking my question. For the US law, how far are you in the preparation? What preparations have you done there? And also, for SMN, you have presented data on SMN proteins levels in plasma. Are you guys planning to look at SMN levels in the spinal fluid?

Great. So I will pass the first part on and then we will talk about the SMA.

Thank you. Yes, the US is clearly a very large -- it's our largest potential market for Translarna. And we started to build the leadership team and the team that will put all of the elements in place for successful launch next year.

You probably saw that we have hired Eric Pauwels as the head of commercial operations for the Americas. And he brings great deal of experience in commercializing ultra-orphan drugs both in the United States and internationally.

We're delighted to have him on board. And, he is now building our leadership team in the United States so that we can put all of the groundwork in place between now and the end of this year for a launch next year.

And then the question in terms of the SMA, what we found, especially in our preclinical studies, where we looked not only in the plasma, but the muscle, brain, spinal cord, so we were able to show that the plasma was indicative of what was occurring in all of the tissue types. I think that this is an important point, that we were able to show increased levels of SMN proteins in all of the tissues that were investigated.

So I think, in a way, we have the advantage with an orally available small molecule to be able to look at the effects of what happens in plasma. And then be able to correlate that with some of the functions that would be associated with expectations of improving neuromuscular junctions and muscle integrity.

Do you think that will be acceptable by the regulatory authorities?

I think it's too early to tell right now. We need to gather all of the data and then figure out, just understand that better before we can make any claims about that.

Okay, great. Thanks so much.

Ritu Baral, Cowen and Company

First question's on the Translarna launch. What are your current thoughts on timing of formal commercial launches and the rest for the EU top five? UK, France or Italy? And would a transition to a formal launch make any difference to the dollars booked on revenue?

Thanks for the question. You are quite right to underline the negating factor for launches is the pricing reimbursement agreement with the authorities.

As you know, we are very committed to bring Translarna to patients as rapidly as possible. And so, we're very pleased that in countries like Italy and France, we were able to claim the [ATU] cohorts, which essentially allows physicians to prescribe the drug today on a reimbursed basis to those that fall within the label.

So the difference will be that when we finish pricing reimbursement formal negotiations, we will also be able to promote. For now, we're not in the promotional phase. However, it is clear that doctors are interested and willing to be prescribing Translarna now for patients.

You mentioned in the UK. The UK, you probably noticed that the decision-making process for funding of highly specialized orphan drug therapies is being redesigned. And last December, that process was put on hold until the redesign was complete.

And, while we see this as still being in transition, we're expecting the NHS England to make a decision and to fund Translarna with that decision by the end of this quarter. So we're watching that carefully, and we're expecting a decision in this coming couple of months.

Got it. And a quick question on SMN. I don't think any of us would be this nosy if your efficacy data did not look as good as it does.

Stu, can you just comment on whether the eye finding that you saw was in the front of the eye or the back of the eye? And is there any suggestion that it could be related to the chemistry of the compound?

Yes, thanks for that. I think it is a little too early to say or disclose. I think we need to go through and understand it and then give you a better feel for it at another time.

So I think that's really what we can say right now. And I think, just to put it again in perspective, I think when you think about drug development, every drug has a therapeutic window.

And our job is to -- or any job within developing a drug is to identify an active dose within that window. That is just part of the process that is going on now.

My last question is on the CF program. How have -- can you give us more detail or characterization of your discussions with CHMP on a potential conditional approval in CF in Europe?

Can you compare the discussions and the negotiations with what happened during your additions review as was published in the summary of approval? For instance, has there been a scientific advisory council or committee called on the drug?

Yes, that's a good question. We have had a scientific advisory workshop committee where we felt that it was a positive discussion to be able to move forward to submit for an approval. In this case, as a consequence of having the approval, as a consequence of the Duchene muscular dystrophy, as you know, it is a variation.

So the actual timeline within that process is actually shortened. It can be as little as a three-month process.

And so, therefore, what our plans are to, as the trial fully enrolls, that we get relatively well enrolled that we then submit the MAA as a consequence of that. So we're looking to do that sometime in the fourth quarter to be able to do that.

And so, I think stay tuned. I think we're pretty well experienced in being able to do this. So we're excited to move this forward.

Great. Thanks for taking the questions.

Debjit Chattopadhyay, ROTH Capital Partners.

Thanks for taking my questions. Just wondering in terms of the SMN program, the data that was presented at the AAN, the efficacy was primarily the 90 milligram dose. So, projecting this forward, where do you think the right dose will be for the program to restart?

I think that what we presented at the AAN was that there was a dose-dependent increase in the concentration of SMA splicing. And so, I think, the goal then was to go from there into the MOONFISH and then to look at the dose and to look at -- have multiple focuses and to find the best and appropriate dose.

I think what we reported here today already, is that we had dosed the first cohort where we saw what we said was substantial splicing as a consequence of that. So we feel good about that in terms of showing that the drug demonstrated activities and is in line with the changes of what we saw in the Phase 1 studies, which is up to 80% on average within that, and we're saying that within this, that we are seeing that or more. So we feel pretty good about the demonstration of the splicing effect.

So, now the job is just to figure out, understand a bit more of the safety finding and then to find like any other drug program, then to find can you find the efficacious dose within the therapeutic window. And therefore, I think it's important to remember that the exposure was below -- in patients, was below what we saw in the exposure that caused the finding in monkeys.

And the Stu, how long was the monkey study -- in terms of the cumulative exposure of the drug? How long did it take for the eye symptoms to manifest?

Yes. This was a longer-term study. It was a nine-month study.

So should we presume the first cohort that you treated in the MOONFISH study was below the 90 milligram dose and it was one of the lower doses? And if you're seeing substantial splicing, so worst-case scenario you can avoid going higher doses?

Yes, I think what we're saying is the exposure was below that. And that therefore, we need to do, like we do in any other drug development program, is to define what the best exposure is within that therapeutic window. I think that's where we're at right now.

And, regarding Translarna, outside of ex Germany, in the Western European countries, are you seeing any pricing pushback that is maybe dragging former reimbursement discussions?

I will pass this on to Mark, but I think in general what everyone will say is that obviously that this is -- the pricing reimbursement is always something that you go back and forth with the payers. But I think we're moving quite rapidly. So Mark, maybe you want to --?

Sure, Stu. So, we're shipping Translarna on a reimbursed basis into countries outside of the EU on a named patient basis, for example, into Columbia. Essentially, those prices reflect European commercial prices. So that is the way that the system works, and we're being reimbursed at that level.

And one more question regarding the rapid switch from the cash basis to a shipped basis within just the first quarter as you are still rolling out in other European countries. Just curious what drove the rapid changeover?

Yes, thanks Debjit. I think, as Mark spoke to, we are now shipping to patients in nine countries and that is expanding with time. And we've got now built up a nice track record of receiving payment, which has given us the confidence that we were able to now switch our revenue recognition to booking revenue on shipment and invoice as opposed to waiting for cash payment. We're getting paid pretty consistently now for a decent period of time.

Thank you and good luck.

Thank you.

Heather Behanna, Wedbush Securities.

Hey guys, thanks for taking the question. Most of my questions have been answered. Just curious about the Translarna launch. When we think outside of Europe, where most patients are concentrated in centers of excellence in places like South America, if you could just give us a bit of color about where patients were found and if it is concentrated or if the market is a bit more fragmented?

Okay, thanks for the question. I think it is actually a mixed picture. You have some very large centers.

So for example in Brazil, there are some centers which are extremely large and very well-organized. But there are also a lot of patients out in other parts of Brazil, in various smaller and less sophisticated centers.

So part of our job is to work with the community to ensure appropriate genotyping and identification of patients is underway. Certainly, we referred to it in Europe that there are some countries which is extremely well-organized reference sensor networks like France And so we get the whole spectrum, depending on which country in the world we're looking at.

Great. Thanks for the color.

You're welcome.

Thank you, and we have no further questions in the queue. I would like to turn the call back over to the speakers for closing remarks.

Thank you, and thank you all for joining call. As you know, it has been our priority to get these therapies as quickly as possible to patients, obviously with high unmet medical need.

We're pleased with Translarna and the fact that to date, we have gotten 82 patients and that the uptake seems good, and we look forward to updating you in the future throughout the year. So thank you for joining the call.

Ladies and gentlemen, thank you for your participation in today's conference. This does conclude the program and you may now disconnect. Have a good day everyone.