PTC Therapeutics Inc (PTCT) 2015 Q4 法說會逐字稿

Good day, ladies and gentlemen. And welcome to the PTC Therapeutics fourth-quarter and year-end 2015 earnings conference call.

(Operator Instructions)

As a reminder, this conference call may be recorded. I would now like to turn the conference over to Emily Hill. Please go ahead.

Thank you. Welcome to our conference call.

Today we will discuss PTC's fourth-quarter and full-year 2015 financial results and provide a Corporate update.

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, and potential outcomes, including statements related to our ability to work with the FDA to resolve matters set forth in the refuse-to-file letter we received in connection with our new drug application for Translarna for the treatment of Duchenne muscular dystrophy and our ability to obtain and maintain marketing authorization for Translarna, the potential success of our products and product candidates, addressable patient populations and financial projection.

Actual results may differ materially from those indicated by these statements as a result of a variety of risks and uncertainties including the timing and outcome of future interactions PTC has with the FDA with respect to Translarna, including whether we are required to perform additional clinical and nonclinical trials of significant cost which, if successful, may enable FDA review of an NDA submission; whether the EMA or other regulators agree with our interpretation of the results of ACT DMD or our other clinical trials; the outcome of pricing and reimbursement negotiations in those countries in which we are authorized to sell Translarna; and those risks discussed under the heading Special Note regarding forward-looking statements and risk factors in our most recent Form 10-Q, which is available from the SEC or our website, and our 2015 Form 10-K which will be available from the SEC on our website later today.

Such statements represent our judgment as of today and PTC undertakes no obligation to publicly update forward-looking statements except as required by law. Information regarding our use of GAAP and non-GAAP financial measures and our reconciliation of GAAP to non-GAAP is available in today's financial results press release.

With that, let me pass the call over to Stuart.

Good afternoon. Thank you for being on the call.

I'm going to start by addressing our recent refuse-to-file from the FDA. Receiving this letter was shocking and deeply disappointing. As you know, we received the letter from the FDA on the evening of February 22. We have spent the last few days analyzing the letter's content and assessing our best path forward with both our internal regulatory chief as well as outside experts.

The letter stated that our NDA was not sufficiently complete to permit a substantive review. There were two areas that served as the basis for the RTF.

First, in the view of the FDA, both the Phase IIB and Phase III ACT DMD trials were negative and did not provide substantial evidence of effectiveness. The FDA also characterized certain of our adjustments to the ACT DMD study as post-hoc and therefore not supportive of effectiveness.

Second, the FDA noted that the NDA does not contain adequate information regarding the abuse potential of Translarna.

We are surprised by this letter, given the FDA's recent guidelines on flexibility for DMD drug development and their willingness to review NDAs of other DMD therapies that missed the primary endpoints. With regard to evidence of effectiveness, let me remind you that we have now completed two large double-blind placebo-controlled trials in over 400 nonsense mutation DMD patients.

In a rare, devastating, progressive disorder we have demonstrated clinically meaningful benefit in one year studies across both primary and secondary endpoints. We believe the totality of the data is supportive of the effectiveness and demonstrates a strong safety profile.

Indeed, it was on the basis of this positive benefit risk profile that the European Medicines Agency approved Translarna in August 2014. With respect to evaluating the potential for abuse, this is an FDA requirement for new molecules that cross the blood brain barrier. We believe based on the preclinical and clinical work we have done, we should be able to address the FDA's concern and demonstrate that Translarna has not shown central nervous system effects associated with abuse potential.

PTC is engaging in a dialogue with the FDA to discuss and clarify the matters set forth in the letter and to determine the best path forward. Translarna deserves a full and fair hearing in front of the FDA, including an advisory committee with representatives of the DMD community. We believe in the strength of our data and what it represents for patients. Our goal remains to obtain regulatory approval for Translarna in DMD in the United States.

While we fully appreciate the gravity of the FDA's letter, it should not overshadow a number of key milestones that we successfully achieved in 2015. We continue to build a leading fully integrated biotech company that discovers, develops and commercializes novel therapies for rare and neglected diseases. We've been working closely with all stakeholders to bring Translarna to patients around the world as quickly as possible.

To that end, since the beginning of this year, we are pleased that patients in Argentina, Czech Republic, Singapore, Hungary and Portugal now have reimbursed access to Translarna. In total, we now have commercial sales in 23 countries and developed a global footprint in over 46 countries.

We are supplying Translarna commercially to an increasing number of patients across Europe, Latin America, Asia Pacific, and other regions. Of the estimated 5,000 nonsense mutation DMD ex-US patients, we have already identified over 1,000.

We continue to support genotyping and patient identification efforts worldwide. Our goal for 2016 is to expand access to Translarna to at least 35 countries. As we told you at this time last year, for 2016, we are transitioning to providing Translarna revenue guidance in order for the investor community to track our progress.

As Shane will discuss in more detail, our Translarna ex-US DMD revenue guidance for 2016 will be $65 million to $85 million. As we continue to expand Translarna globally, we are working through market access on a country by country basis.

As everyone is probably aware, payers in Europe have become increasingly sensitive to pricing and reimbursement in healthcare in recent years. We have been working hard with the local reimbursement authorities to ensure sustainable access to Translarna.

We recently met with NHS England, where we made great progress outlining a managed access agreement. Overall we feel we have been in very constructive dialogue with NHS England and NICE. These discussions, which included other stakeholders, culminated in a draft managed access agreement. Subject to NICE approval, this would allow for sustainable reimbursed patient access in England.

In Germany, we've had multiple discussions with their reimbursement body over the course of the last several months to come to an agreement on pricing and reimbursement. Recently these discussions transitioned into an arbitration process which did not lead to an acceptable agreement. As a result, if necessary, PTC could choose to de-list Translarna from the German pharmacy ordering system.

Under these circumstances, patients and healthcare professionals have the opportunity to access Translarna through our reimbursed importation pathway possible under German law. Thus minimizing any access issues for German patients while maintaining a sustainable price.

In addition to our strong commercial progress to date, we are actively pursuing regulatory approvals around the world. We believe the results across two large placebo-controlled trials in DMD demonstrate Translarna's activity, and, combined with the favorable safety profile, support a strong regulatory package demonstrating Translarna's efficacy.

Of important note, although we did not achieve statistical significance, Translarna is the only DMD therapy to have shown clinically meaningful benefit across both its primary as well as its secondary endpoints in one year clinical studies. This has been an important point of emphasis with key opinion leaders and regulators.

Over the course of 2015, Translarna was reviewed and approved by regulators in South Korea and Israel. We are also currently under regulatory review in Canada where we received an expedited review.

In Europe, we have submitted the ACT DMD results and requested on that basis that regulators remove the condition to the existing marketing authorization. As you are aware, Translarna has the potential to be an important therapy for approximately 10% to 15% of patients suffering from many genetic disorders who have nonsense mutations.

In 2015 we announced our 10 x 20 strategy to investigate at least 10 indications beyond DMD and CF with Translarna by 2020. We currently have four of these indications under development, including MPS1, Aniridia, and two genetically defined epilepsies, CDKL5 and Dravet.

Let me now turn to our program for Translarna in nonsense mutation cystic fibrosis. We experienced overwhelmingly strong demand from physicians and patients who wanted to participate in our Phase III ACT CF trial. The trial completed enrollment in November 2015 with approximately 280 patients. The 48 week trial will complete by the end of this year with top-line data expected in early 2017.

In September of 2015, we submitted an application to add nonsense mutation cystic fibrosis to the existing label for Translarna in Europe. This application was based on results from our previous Phase III trial. We believe that the results are compelling and that it's important to make Translarna available to nonsense mutation cystic fibrosis patients. We are working through the process for a potential CF approval in Europe.

As expected, as part of the process we received questions from the European regulators and we are currently in the process of responding to them. We anticipate a decision on potential approval for CF in Europe in mid-2016 and our team is preparing for a potential launch for CF in that region.

Let me now shift to a program in our splicing platform technology. Our first program using this technology addresses the potential new therapeutic for spinal muscular atrophy or SMA.

SMA is a genetic neuromuscular disease caused by a missing or defective SNM1 gene, which results in reduced levels of SNM protein. PTC, together with Roche and the SMA Foundation, have a robust program around oral small-molecule SMN2 splicing modifiers as a way to address the disease. The SMA treatment with exposure to muscle and nerve tissue may have considerable advantages for patients.

While the clinical trials of RG7800 are on hold, an additional compound RG7916 was also chosen as a development candidate. We recently began a Phase 1 study of RG7916 in healthy volunteers.

As we described previously, because healthy individuals have both the SMN1 and SMN2 genes, there is an advantage in that changes in splicing can be measured in the blood of healthy volunteers. Results from this study will be used to evaluate which is the best compound to move forward in subsequent clinical development.

Let me now turn to our cancer stem cell program targeting BMI1. BMI1 is up-regulated in the tumor stem cell population and is an important component of the complex that allows cancer cells to become resistant to chemotherapy. As you may recall, our compound PTC596 reduced the level of BMI1 protein in preclinical oncology models. I'm very proud to have a fourth internally discovered program at PTC entering clinical development.

PTC596 began a Phase 1 study in the second quarter of 2015 in an advanced cancer patients with solid tumors. We are excited to share data from this program later this year. As you can see, we're poised to accomplish many commercial, regulatory and clinical milestones in 2016.

With that, let me turn it over to Shane to talk about our financial results for the quarter and 2015. Shane?

Thanks, Stu.

We're happy to report a landmark first year launch outside the US with Translarna net product sales of $33.7 million. In the fourth quarter, we recorded $12.7 million in net product sales representing approximately 30% sequential growth over the $9.8 million we recorded in the third quarter of 2015 and versus $0.6 million in the prior year period.

Non-GAAP R&D expenses in the fourth quarter were $31.4 million. Compared to $23.7 million for the same period in 2014.

R&D expenses increased year over year as a result of additional costs associated with our expansion of our clinical development activities including late stage studies in both DMD and CF.

Non-GAAP SG&A expenses were $21.7 million for the fourth quarter of 2015, compared to $14.5 million for the same period in 2014. SG&A expenses have increased year over year as a result of the commercial launch of Translarna. PTC has grown its capabilities both domestically as well as internationally to support our current and planned global launch activities.

We reported a net loss of approximately $51 million for the fourth quarter of 2015, compared to approximately $27 million for the same period of 2014. Our net cash burn for the fourth quarter was approximately $33 million and we finished 2015 with nearly $339 million in cash and marketable securities on our balance sheet. We currently have 34.3 million shares issued and outstanding which includes 0.3 million unvested shares and restricted stock grants.

In terms of guidance, and as Stu mentioned earlier, we are now in a position to provide revenue guidance for 2016. Based on our internal assumptions with respect to the continued commercial expansion of Translarna for DMD outside of the US, we currently anticipate net sales to be between $65 million and $85 million for 2016. This guidance assumes current exchange rates and a continued rollout on a country by country basis for Translarna outside of the US.

As we progress throughout this year, we anticipate updating this guidance when and if appropriate. With respect to operating expenses for the year, given the refuse-to-file letter we recently received, we are reevaluating our 2016 operating budget. And are therefore not in a position to provide operating expense guidance at this point. We anticipate providing expense guidance on a future call.

Joining the Q&A are my colleagues Bob Spiegel, CMO; Mark Rothera, our CCO; and Mark Boulding, our Executive Vice President and CLO who oversees our regulatory function.

(Operator Instructions)

Our first question comes from the line of Geoff Meacham with Barclays. Your line is open.

Hi, guys, this is Carter on for Geoff. Thanks for taking our questions. I guess first on the RTF and the FDA's characterization of some of the analyses as post-hoc, I'm trying to reconcile that with past comments that the stat plan was submitted to the FDA earlier in 2015.

So I guess specifically between that time, the stat plan went in and the SNDA -- or the NDA was, went in -- was there any interaction with the FDA on the stat plan over this period and were there any changes to the stat plan from your side over that period? And then second question, just real quickly, on the 2016 guidance, what is assumed surrounding pricing in Germany? Thank you.

Great. Thanks, Carter, for the question. So maybe it would be best to first review some of the -- just some of the history so that -- let me just review a little bit on -- we received the letter from the FDA on Monday night. Obviously as I said in the call that we were very surprised to have received this letter given the FDA's recent guidelines on flexibility for DMD drug development as well as their willingness to review NDAs of other DMD therapies that have missed primary end points.

So let me remind you that we completed two large double-blind placebo-controlled trials in over 400 NMD, Duchenne muscular dystrophy patients and this rare devastating progressive disorder and we believe we've demonstrated clinically meaningful benefits in one year studies across both primary and secondary end points. And that obviously we believe that the totality of the data is supportive of the effectiveness and demonstrates a very strong safety profile. And it was really on the basis of this benefit/risk profile that the European Medicines Agency approved Translarna in August 2014.

On the -- overall on the subgroup analysis, the FDA characterized -- first of all the FDA characterized our NDA as not supportive of effectiveness. This would include the subgroup analysis.

So I think in terms of the history it's important to remember that we included the subgroup in our statistical analysis plan which we submitted in the spring of 2015. At that time the FDA commented on our statistical analysis plan but had no comments on our subgroups.

We submitted the final statistical analysis plan to the FDA before unblinding the ACT DMD study. However in the RTF letter the FDA characterized that PTC proposed a post hoc adjustment of ACT DMD that eliminates data from a majority of enrolled patients. So we need further discussion with the FDA to understand their current perspective on our subgroup analysis.

We believe the FDA's perspective in the RTF letter may be that although we've pre-specified the subgroup, relying on the subgroup as the main analysis is considered as a post hoc adjustment and we'll be talking to them further on this point.

In terms of the German pricing and reimbursement, let me ask Mark Rothera maybe to comment a bit on that.

Sure, Stu. Well, as you're aware in the past we recorded patient numbers and we gave pricing guidance. Now as Shane mentioned, we're moving to revenue guidance, which integrates both pricing expectations, patient numbers, average wait for patients, and exchange rates.

And so the question you're asking is integrated certainly into our thinking on the revenue forecast, specifically as you're well aware the GKV took a very tough stance on pricing in Germany. Our expectation is that unless there's a change on that, that we will -- or the patients will be able to import Translarna from an alternative country in a pathway that's available by law -- that's available both to existing and new patients and allow them to receive ongoing treatment at a sustainable price level.

Thank you.

Thank you. Our next question comes from the line of Anupam Rama with JPMorgan. Your line is open.

Hello, guys, this is Eric in for Anupam. Thanks for taking the question. Just a couple of questions on the EU.

To what extent are your ongoing P&R discussions contingent on a CHMP opinion on ACT DMD, and just with respect to Translarna availability in Germany going forward, to what extent does the GKV's decision affect your ability to market to German physicians? How does reimbursement outside the GKV system represent a hurdle to patients' [inclusion]?

Thanks for that, Eric, and so I'll just start out and then I'll pass it on to Mark. Clearly we have a lot of pricing and reimbursement discussions going on that are based on our Phase 2B data and in the midst of that, then I'll have Mark talk about that as well. As in terms of the German -- as Mark alluded to, I think we'll talk a bit about part of this is the clear path to allow patients to maintain access of the drug at what we think is the most fair and sustainable price, and he can talk a bit about that.

So maybe I'll pass that on to you, Mark. Just to clarify that.

As you're aware we're already selling Translarna in 23 countries and there are six countries where we've already been through the pricing and reimbursement negotiations and have a commercial price. So there isn't a contingency around the CHMP decision that's expected here.

With regard to Germany, there is a path as I mentioned that enables patients to have access to essential medicines that aren't available on the German market. The drug is approved in Germany, it can be promoted in Germany, it can be prescribed in Germany, but by choosing to de-list what we're avoiding is a list price at a level that we believe is unsustainable and we're enabling patients to request authorization of the drug through importation.

And just to remind you, the GBA, which is the health technology assessment body in Germany, already opined on the value of Translarna and gave the drug a rating of three on a scale of one to six where one is the highest and six is the lowest. About 50% of orphan drugs that go into the German HTA process get a four or a non-quantifiable benefit, whereas Translarna was given a three or a quantifiable benefit. So when it comes to patients requesting access to the drug, not only is it a drug that the insurers will see have been given a three from a medical value perspective but it's the only approved drug for what is a very life-threatening condition.

I guess the final thing to say around this is that the GKV appear to have taken a tough stance. It seems contextual. I don't know if you saw their press release of 21 January, but they're really pushing hard on orphan pricing and the GBA value assessment at this time, and I think we're caught up in that situation.

Thanks for taking the question.

Thank you. Our next question comes from the line of Ritu Baral with Cowen. Your line is open.

Hi, guys. Thanks for taking the question. I have three questions. One is very, very quick, just as a follow-up. Is the guidance that you have put out today assuming the same $300,000 pan-European average drug price that you have stated previously?

So as I mentioned earlier the guidance on revenues do not specifically give a view on a particular price. It's an integrated view on pricing in different jurisdictions, patient numbers [wait] and exchange rates. So we're not going into specific pricing on a country by country basis.

But to be very clear we stand by on confident in the $65 million to $85 million revenue range that we've quoted in our revenue guidance, ex-US.

Is there a chance that full-year 2015 revenues will need to be restated because of the refund that you might have due to Germany because of the arbitration process?

Hello, Ritu, it's Shane. It's a great question.

Under the German system, when you're approved to launch as we did in December of 2014, your first 12 months are pricing of where the Company sets and thereafter, which would be for us as of December of 2015, you're obligated to accept the price that you're settled on or the one that we would have just received through German arbitration. So for the month of December, the one month in 2015, any sales for that month will be at that lower price and we've made that adjustment in our gross to net what we reported today.

Got it. And do you have a specific timeline for speaking to FDA on the RTF set? Have you had any phone conversations with them or do you have a meeting scheduled yet?

Yes. Obviously the next step for us is really obviously our goal is to ultimately get it approved so that the US patients can benefit from it. At this point, we have requested a call with the FDA to clarify and understand better the points they made in their RTF letter. And then obviously there's multiple options and the path that we choose will be determined really through subsequent discussions with the FDA and what we'll do is update you when we have more clarity.

Just sneak one more in there. Did the abuse potential come up in your Summer 2015 letter -- or sorry, meeting before the ACT DMD data came out?

Did what. I'm sorry, say that again?

Is the abuse potential qualifier in the RTF?

Come up previously? No. Well first of all it's really our belief that ataluren doesn't have any abuse potential. It didn't come up previously, and that's based on both the structure of ataluren, the lack of any signals from animal studies as well as our clinical studies that we've conducted in different indications.

That in the context of their preliminary review the FDA may not have appreciated all of the information we provided on this topic in our NDA. So our plan is to provide a single document that gathers together the relevant information from the NDA and we do believe that this would be sufficient to satisfy the FDA.

Great. Thanks for taking all the questions. I'll hop back in the queue.

Thank you. Our next question comes from the line of Heather Behanna with Wedbush Securities. Your line is open.

Hey, guys, thanks for taking the question. I've got a couple. One is just if you could give us a little more color on what's going on with NICE in the UK, and then the second question is if you could talk a little about if there's still any lag in revenue or what exactly is the gross to net adjustment or what factors play into that? Thanks.

Sure. So maybe I'll just give a little bit of color, and then I can talk. And in general we've been working hard obviously with the local reimbursement authorities to ensure sustainable access to Translarna. And that overall we feel we've had very constructive dialogues with both NHS England and NICE.

So I think that's where we're at, so I think that we're waiting -- we've had these NICE discussions. We've elaborated on managed access program with them that we're waiting for NICE to approve and so that's where we are right now with that. In terms of the revenue, maybe, Shane, do you want to?

Yes, for us we recognize obviously our net product sales revenue and there is certain minor adjustments in the gross to net, Heather, like for instance in Germany there always is a mandatory 7% discount which we had always been reporting in our gross to net. And in addition as you may know in certain countries or territories we have chosen to work with certain third-party distributors, and those distributor margins are factored into our gross to net pricing. So any sales that we report are the net sales to PTC.

Great. That helps. And then just a quick follow-up on NICE.

I know that there was a meeting on February 17 discussing ataluren. So I was just curious if that was the full data set, including the Phase 3, and if we should probably expect something published from that meeting at some time in the next few months? Thanks.

Yes, I think there was some discussion that we had that -- which was following up the NHS England meeting. So I think -- so it was a very good and constructive dialogue that we had at the NICE meeting, and so we will then wait for their final decision that will come out of that.

Thank you.

Thank you. Our next question comes from the line of Christopher Marai with Oppenheimer. Your line is open.

Hey, good afternoon, thanks, guys, for taking the question. First let's start with maybe the pricing discussions in Germany, obviously we've heard some numbers thrown around.

I'm wondering if you could further elaborate on a discount that was requested in the arbitration. And then two, I know you don't want to list the drug in Germany at that price, and Germany is a reference point for spending other countries.

Is it possible that other countries could look at those arbitration documents, are they going to be public? And then push for a price in order to what the Germany authorities have requested? And I've got a follow up. Thank you.

Thanks. Maybe, Mark, why don't you talk a little bit about the pricing discussion discount and reference price?

So hi, Chris, you're quite right and just to be very open. I mean the request was for a 57% discount on top of the 7% mandatory rebate. So clearly that would take us into an unsustainable and unrealistic price level for Translarna.

And as we mentioned earlier, the plan B that we had already understood was available to patients is to have the drug imported from abroad at a more sustainable price level. Indeed even in the arbitration process, the GKV admitted that that was available to these patients and is a tried and tested route for medications urgently required for patients.

And just to add on that as Mark, is that each country does have its own process and just a reminder that to date we've established an agreed commercial price in six countries now. And that really we think importantly by not establishing this unacceptable reference price we are seeking to protect the value of Translarna as a consequence of that. So that's why we did this -- or will be doing this.

Okay, got it. And then I guess the next question would become, just maybe focusing on the EMA and the conditional approval removal. I was wondering if you could elaborate perhaps on what exactly was required for that and any discussions they had with you.

We know that as part of the conditional approval you needed to run a trial. In terms of removing it, was there any clarity that you guys have received that the trial needs to be successful or support the benefit, et cetera. Could you perhaps elaborate on what was actually required there? Thank you.

Sure. Actually, when you look at actually what they asked for, really the condition was the completion of the ACT DMD trial. That being said, obviously they are reviewing the ACT DMD data and we expect to have a decision by midyear on the application to remove the condition from our marketing authorizations.

Let me -- I know everyone's thinking about the RTF but what I can remind you is the last time we received an RTF from the FDA for our NDA was based on the Phase 2B data that the EMA approved Translarna on based on those same results.

Okay, that's helpful and then just maybe one last one here for Mark and Shane perhaps. Could you just maybe break out the number of patients on drug in the EU, and the rest of the world I guess it would be not-EU, not-US, and then maybe you can break out the current number of patients that you have receiving the drug in Germany for us? Thank you.

So, Chris, thanks for the question. I think we -- you heard on the call earlier that we estimate there are about 5,000 nonsense mutation DMD patients ex-US. We've already identified about 1,000 of those patients.

We've given you a revenue guidance that gives you a sense of the revenues that we're going to achieve this year, and that represents not only pricing assumptions but patient growth. We're not breaking this down at this time by region, just to be clear.

Not even Germany?

Not by country, no.

Got it. Okay, I tried. Thanks.

Thanks.

Thank you. Our next question comes from the line of Gena Wang with Jefferies. Your line is open.

Thank you for taking my questions. So the first one maybe for the refuse-to-file letter, just wondering did the FDA ask about biomarker data?

Yes. So in terms of the dystrophin data I think it's important that no mention of the dystrophin or biomarker measurement was stated in the RTF, and that we're very confident that the FDA did not have any issue with the fact that we were not measuring dystrophin in ACT DMD. We had discussed our trial design with the agency multiple times, and I think this is very consistent with what the FDA said at both their dystrophin workshop last June and the advisory board and briefing book recently from the other DMD companies.

Great. So I have a few questions regarding the European market.

So I think, Mark, you mentioned that there are six countries that secured the reimbursement. Just wondering I think I had the name, Germany, Denmark, Norway, Austria and Sweden. Just wondering what's the sixth country?

We've actually had reimbursement in Slovakia, Hungry, and Czech Republic, just to be clear in addition to the countries you've mentioned. So in total, Austria, Denmark, Norway, Slovakia, Hungary, and the Czech Republic.

I see, okay. And then for the $33.7 million in 2015, wonder if you could tell us how much you would generate from actual commercial launch, which means through the reimbursement system, and how much you would from patient name programs.

We don't give that breakdown. It's actually an interesting combination of both, because as you know there are mechanisms that allowed reimbursed early access as well as full commercial launch, but actually the distinction between those two becomes quite blurred and at the end of the day we are selling Translarna in 23 countries now.

Okay. So maybe last question. So for Germany if you de-list Translarna, can a patient only get drugs from the countries that have commercial launch? Or can they also get drugs from countries with the patient name program?

Either is probably possible, but it's most likely because the authorities will look to sort -- or the pharmacists will look to source where it's easiest to get the drug. They'll probably go to places where there's already good commercial availability from a supply chain point of view.

Okay great. Thank you.

Thank you. Our next question comes from the line of Simos Simeonidis with RBC Capital Markets. Your line is open.

Hi, guys, thank you for taking the questions. Regarding the RTF, what is your plan forward given what's in the letter? Do you plan to go through an appeal process, or how do you plan to go about I guess convincing the FDA regarding the effectiveness of the drug?

Yes. Thanks, Simos. So we've already put in a request for a call with the FDA. There's a clear path as you mentioned to escalate this decision within the agency. We're also entitled to a Type A meeting which is granted within 30 days.

So our goal is to with the FDA is to discuss and agree upon a path forward for the best possible outcome, and following these discussions we'll be in a better position to update you on what that path is.

Okay. And then in Europe can you remind us -- I don't know if it has been disclosed in the past or not -- but does the CHMP that's reviewing the CF, is it the same rapporteurs that are reviewing the conditional approval on DMD?

Yes, the rapporteurs that review the DMD are the same rapporteurs who review CF.

So the, okay, all right, thank you very much.

Thank you. Our next question comes from the line of Alethia Young with Credit Suisse. Your line is open.

Hey, guys, this is Ellie on for Alethia, thanks for taking the question. So just in terms of Latin America, since you guys have spoken about the large number of patients in this region, could you discuss sort of how pricing is set here and how much this price depends on the list price in Europe?

Sure. Mark, you want to talk a little bit about that?

So hi, yes. We're obviously delighted now that Translarna is available on a reimbursed basis in Argentina as well as Brazil and Colombia and Peru. You know the pricing there is actually set in dollars, and I obviously don't go into specific prices as we've said before.

Prices are integrated into our revenue guidance that includes some overall net pricing as well as patient numbers, waits, et cetera. So I'm not in a position to give you specifics around those countries.

Okay. That's helpful. Thanks. And then just a quick follow-up.

In terms of sort of how the de-listing would potentially work in Germany, could you maybe sort of help us think about how this would work particularly with some maybe examples of drugs that de-listed from the German pharmacy ordering system, but then continued to say charge a higher list price in other European countries? Or maybe if there are situations we can look to where the commercial prices may have differed significantly say between different European countries? Thanks.

So I understand that the law changed in 2011 that allows for this foreign drug importation, and that there aren't hundreds of these examples but I've -- for example I can give you a few today that for epilepsy, GSK's Trobalt and Eisai's Fycompa are examples of products that were de-listed and then actively imported. I mean, not only was it communicated that the drugs were available through company communication, but also interestingly the insurers themselves communicated that the drugs were available through foreign importations. So this is a tested route.

I think what is also, I think, very important to think about is that Translarna is for a very high unmet medical need. There are no alternatives and the drug has been given a good benefit rating by the GBA. So I'm sure the insurers when they look at this will take a favorable view.

That's helpful. Thanks.

Thank you. Our next question comes from the line of Ritu Baral with Cowen. Your line is open.

Hi, guys, thanks for taking the follow-up. Stu, now that you've had a few days to think about the RTF letter, if you start talking to FDA and the worst-case scenario unfolds. What is your commitment, what is PTC's commitment to potentially doing another -- yet another study for Translarna in DMD? What are your thoughts at this point on the worst-case scenario?

Yes, so we've been obviously doing a lot of thinking about this over the last few days and really our goal is to get Translarna approved in the United States as it is in Europe and other places around the world. In terms of when you think about our commitment, we've -- I could tell you we've been, I founded this Company, what 18 years ago, and it's gone through a number of ups and downs through this process, so I think in terms of our commitment it's been very strong.

Ultimately though we have to discuss the options, all our options with the agency as we move forward. And so until we have more dialogue, it's probably premature to predict what the next steps are or whether we need additional trials.

I will point out that we've already done two large well-controlled, placebo-controlled trials that define a very robust data set. And so we're going to be talking to them about those results and how we can move forward on that.

And then on the subpopulation analysis that you mentioned that you had proposed in the stats plan but that was not commented upon, was there any subpopulation, any six minute walk cut that you presented at the time of topline data that was commented on? When you submitted the stats plan or was none of it essentially commented on?

I think, you know, what was -- when you think about what we said was and what we characterized is that the FDA characterized that the results in the NDA are not supportive of effectiveness. This would include the subgroup analysis, so I think what we need to do is what we want to do is to go forward with the FDA to discuss this with them further.

Okay. And last question. The expanded access program, and there is the named patient programs that you have ongoing currently, is there any time limit on any of these or expiration dates on any of the programs that you have in place right now?

There aren't any specific deadlines that are sort of date deadlines, but what you'll see is that in countries in Europe for example where the early access program is possible, those will transition once we've been through the pricing reimbursement discussions into full commercial sales. So it's a sort of an evolutionary process.

In countries outside of Europe, like for example Singapore or we just recently talked about Argentina, we still have to at some point file for local registration and until that happens, it will continue to be on a named patient [imported] basis.

But it sounds like in Europe you can't sustain the business just on a named patient program going forward in perpetuity. At some point the price discussions will be held and --

Yes (multiple speakers). The system is designed to transition from early access through to full commercial via the pricing reimbursement discussion, so that's the normal process.

And is this a two- to three-year process from this date as far as you know if you can get a handle on right now?

It just depends on every country's system. They're all different, so some happen faster and some can take longer. It just depends on the timelines and the process for each country.

Got it. Thanks for taking the follow-up, guys.

Thank you. That does conclude our Q&A session. I'd like to turn the call back to Stuart Peltz for closing remarks.

I just wanted to -- we all understand that these are frustrating times for all our constituents, not only for our investors but for the US boys and young men and their families who are suffering from Duchenne muscular dystrophy. For them every day counts and every function lost cannot be regained. That's why I work so hard to bring Translarna to patients. I will focus our energy to resolve the process with the FDA and bring this therapy to the US nonsense mutation DMD patients. Thank you for joining the call.

Ladies and gentlemen, thank you for participating in today's conference. This does conclude the program.

You may now all disconnect. Everyone have a great day.