PTC Therapeutics Inc (PTCT) 2017 Q3 法說會逐字稿

Good day, ladies and gentlemen, and welcome to the PTC Therapeutics Third Quarter Financial Results Conference Call. (Operator Instructions) As a reminder, today's program may be recorded.

I would now like to introduce your host for today's program, Emily Hill, Head of Investor Relations. Please go ahead.

Good afternoon, and thank you for joining us to discuss our 2017 third quarter corporate updates and financial results. Joining me on today's call is our CEO, Stuart Peltz; and our Chief Operating Officer, Marcio Souza; and our Principal Financial Officer, Christine Utter.

Before I hand the call over to Stuart, I would like to remind you that today, we will be making forward-looking statements. These statements include all statements other than those of historical facts, including statements concerning financial guidance, our expectations with respect to the future commercial availability of and access to EMFLAZA, the anticipated benefits of the EMFLAZA acquisition, the outcome of any formal dispute resolution request filed with the FDA for our Translarna NDA, our future expectations regarding other clinical, regulatory and commercialization matters, including with respect to potential outcomes and anticipated timelines; anticipated timelines of our SMA collaboration with Roche; addressable patient population for Translarna and EMFLAZA; and the potential success of Translarna for the treatment of nmDMD and EMFLAZA for the treatment of DMD. Actual results may differ materially from expressed or implied by forward-looking statements as a result of a variety of risks and uncertainties, including those related to our continued commercial launch of EMFLAZA, including our ability to secure adequate pricing, coverage and reimbursement terms with third-party payers for our products in a timely manner, whether and to what extent third-party payers impose additional requirements before approving EMFLAZA prescription reimbursement; our ability to integrate EMFLAZA into our business and realize the anticipated benefits of the acquisition; changes in laws and regulations; our ability to resolve the matters set forth in complete response letter we receive from the FDA in connection with our NDA for Translarna for the treatment of nmDMD, either it be an outcome of any formal dispute resolution request or other interactions with the FDA; and those risks discussed under heading, Special Note, regarding forward-looking statements and risk factors in our second quarter Form 10-Q, which is available from the SEC and on 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.

We will disclose certain non-GAAP information during this call. Information regarding our use of GAAP and non-GAAP financial measures and a reconciliation of GAAP to non-GAAP is available on today's earnings release.

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

Thanks, Emily. And thanks for joining us on the call this afternoon. As a global commercial-stage rare disease company with a growing pipeline, we are pleased with the progress we are making to deliver innovative medicines and drive better outcomes for patients with rare and neglected disorder. As we will be entering our 20th year in 2018 since we founded PTC, it is important to reflect on where we are and what we have accomplished over the last 2 decades. Furthermore, it is important to plan where we will be going in the years ahead.

As champions for access to treatment for patients with rare and neglected disorders, our strategy remains the same. There is still a considerable amount of important work to bring Translarna to all patients worldwide. We are disappointed with the FDA decision and plan to work to change this action. We believe that United States patients, like others around the world, should have access to this important therapy.

We plan to continue to build our research and development pipeline and to commercialize these drugs so patients have access. Our mission continues to be to discover, develop and commercialize best-in-class treatments for rare diseases. The discovery of Translarna demonstrates that we can go from taking a cutting-edge innovative basic science concept and go through the process to where we, now, commercializing this in 25 different countries.

Commercializing EMFLAZA demonstrates that we are also willing to look outside our own internal research and development efforts and that we will bring in products that fill an unmet medical need that we think are important for patients to access. We continue to use both of these avenues to grow and bring the best products to patients. PTC is now in the position of having 2 commercial products and have an effective global commercial operation that we will continue to leverage our commitment to patients.

We have a lot to review on today's call, including our commercial growth, our regulatory status for Translarna in the United States, the advancements of our SMA program to pivotal study and our financial strength. I'd also like to introduce a new voice on today's call, Marcio Souza, an executive we internally promoted earlier this summer to Chief Operating Officer. Marcio will provide the commercial and clinical development updates, which will drive our next phase of growth. We will end the call with a thorough review of our strong third quarter and financial outlook from Christine Utter, our Principal Financial Officer. These individuals reflect the strength of leadership team, complementing the strong management already in place. We are highly engaged and aligned on strategy to continue to execute on our global, commercial, R&D and financial performance.

This execution has led to a strong year-over-year revenue growth. In the third quarter, Translarna reported revenue of $32 million, a 45% increase over the prior year. In the third quarter, EMFLAZA reported revenue of $9.8 million. We are raising our EMFLAZA guidance from $15 million to $20 million to $20 million to $25 million for the full year 2017, which reflects the strength of the launch to date. Our commercial performance in the third quarter was driven by both the strong EMFLAZA launch in the United States as well as Translarna's continued sales growth in every region where it is available.

As we announced last week, we received the complete response letter from the FDA's Office of Drug Evaluation I for Translarna. While we are extremely disappointed with this action, we continue to believe in the positive benefit-risk demonstrated at both clinical trials and real-world experience. We expect to file a formal dispute resolution letter this week and look forward to interacting with the Office of New Drugs during the course of this appeal.

Before moving on to other updates, I'd like to take a moment to thank the Duchenne community for their continued support during this process in the United States. We heard from hundreds of patients and their caregivers, both families and physicians. Many wrote letters to the FDA and dozens traveled to our Advisory Committee to speak about the impact Translarna has had in their lives.

We also saw tremendous support from the physicians and patients outside the United States who had commercial access to Translarna for years. Over 100 physicians outside the U.S. signed and submitted a letter to the FDA testifying to the efficacy and benefit of Translarna they have witnessed in their DMD patients. We strive to bring United States patients the same access and benefits experienced by nonsense mutation DMD patients around the world.

We are also focused on developing our oral SMA therapy in partnership with Roche and the SMA Foundation. As anticipated, the SUNFISH study for type II and III patients transitioned to pivotal stage in mid-October, triggering a $20 million milestone. We look forward to advancing the FIREFISH study for SMA type I patients in the coming months. Later in the call, I'll speak to the data generated to date in this program.

The advancements that the company has made in the commercialization of Translarna and EMFLAZA and in our research and development pipeline placed us to complete 2017 in a strong financial position. This is critical since, longer-term, the progress that has been made in these drivers positions us to be a sustainable global commercial company with an innovative research and development pipeline.

Let me now have Marcio provide you with more detailed updates on our commercial and clinical activities. Marcio?

Thanks, Stu. I'm pleased to have joined PTC's executive team and look forward to our success ahead.

Now starting with this quarter's performance for both of our commercial assets, EMFLAZA and Translarna. Let me start with EMFLAZA, which reported $9.8 million in revenue in this quarter. We launch EMFLAZA in the U.S. about 6 months ago with the firm belief that the (inaudible) supporting the use for DMD patients 5 years and older was strong, and that all eligible patients should receive the best possible care, which includes, in our view, the only approved treatment for all DMD patients in the U.S., EMFLAZA. We are fortunate to have our own data presented several times as well as independent data from the Collaborative Trajectory Analysis Project, or cTAP, which aligned with our view of the clinical benefits of EMFLAZA. The reception of EMFLAZA by both patients and health care providers in the U.S. has been strong. I am pleased to confirm that over 1,500 patients are currently receiving EMFLAZA, and that the out-of-pocket cost for those patients remains close to 0.

We continue to receive positive feedback from both patients and physicians. While the current [momentum update] give us confidence on the path forward, we are, therefore, raising the guidance to $20 million to $25 million for the full year 2017. While these results are encouraging, our work is far from over. As we move to the second phase of our launch, we are intensifying the investments and focusing our resource on 2 critical issues. The first one is to improve the awareness and knowledge of the benefits of EMFLAZA as the standard of care for naive patients.

The second is to remove barriers for patients and providers who wants to switch from their current treatment. We are deploying a combination of educational campaigns, increasing our medical affairs efforts and investing in scientist communications. On the payer front, our communication strategy will continue to focus on all available scientific data, which support the use of EMFLAZA by all eligible patients. We presented data at ISPOR international meeting in May showing that the patients on EMFLAZA had a benefiting muscle function which correlates with up to 4 years in delay to loss of ambulation. This is not only relevant because of the loss of ambulation itself, but also because the learnings from natural history suggest that a change in the time to loss of ambulation correlates to delay in other significant milestones such as mechanical ventilation and death. This data was part of the motivation for the EMFLAZA physician, and we are proud to bring this therapy to all eligible U.S. patients, most of whom previously did not have access. Lastly, we've just received the written request from the FDA to conduct a pediatric study for EMFLAZA, which upon completion will allow us an additional 6 months of market exclusivity. We plan to conduct that study.

Now switching gears to Translarna. As Stu said, we remain committed to bringing Translarna to U.S. patients and at the same time, we continue to expand the adoption globally. The overwhelming support demonstrated by patients and more than 150 physicians globally in connection to the FDA process continues to bring forth our confidence in the impact we are having on patients' lives globally. In the 3 years since launch, we have seen tremendous uptake in the European Union and Latin America. And most recently, we have begun expanding into the Middle East and Central and Eastern Europe. Patients and physicians have expressed benefits on therapy, and compliance has remained over 90%.

Translarna is growing in every region. In fact, as we look to 2018, the project double-digit patients growth globally, which will be driven by increased penetration. Our mission is to make Translarna available for every eligible patients globally. To fulfill that vision, we reinforced our investments in early diagnosis, proper genotyping and disease education, which together will improve the standard of care for DMD patients.

Diagnosis for DMD patients globally is still happening too late, with [average rates] higher than 5 years of age in virtually all country. Our locational campaign called [Take on Duchenne] is focusing on addressing this issue. When patients are finally diagnosed, oftentimes proper and fast genotyping is not available. We have partnered with several groups globally to address access to genotyping. While we are pleased with the results to date, we plan to further expand the efforts moving forward.

Lastly, we are involved in efforts to improve the overall standard of care of DMD boys and young men, including the use of steroids and best physical therapy practice. These efforts not only support the commercial growth of Translarna but are aligned with our mission of improving the life of patients suffering with this debilitating disease.

Let me now provide a short update on the development programs for Translarna in DMD. We recently completed a PK study of Translarna in children aged 2 to 5 years old. Patients on that study transitioned to 1 year safety and exploratory efficacy phase, which we expect to complete early next year. The second is our long-term study, 041, which started enrolling patients in the third quarter. As a reminder, this is a specific obligation of our EMA approval. Outside of DMD, we have completed enrollment for our aniridia study and we anticipate results during 2018. We are confident that we are well-equipped to drive value, with strong commercial capability and a continued focus on transforming lives for patients with rare and neglected disorders.

I'll now hand the call back to Stu. Stu?

Thanks, Marcio. Let me now switch gears to another program, which is based on our small molecule splicing platform. This technology has been used to discover potential new therapies for spinal muscular atrophy, or SMA, a rare genetic neuromuscular disorder that generally manifests early in life and is a leading genetic cause of death in infants and toddlers. This disease affects the whole body, not only the central nervous system, but other tissues as well. We have a robust program in collaboration with Roche and the SMA Foundation around oral SMN2 splicing modifiers. We believe that an oral therapy should provide a competitive advantage. This is because it allows exposure throughout the body, including key tissues affected by SMA such as muscle, liver, bones, peripheral and central nervous systems. In fact, preclinical evidence supports that RG7916's pharmacodynamic effect seen in blood are mirrored in the CNS. This data will be presented at a major medical meeting early next year.

As we discussed before, there are 2 registrational studies ongoing. We are proud to report that the first, SUNFISH, has recently entered the pivotal stage and is enrolling. Data from the first dose escalation phase of SUNFISH was recently presented at the World Muscle Society Congress. An interim analysis of the 5 cohorts treated with RG7916 versus placebo for 28 days demonstrated an exposure-dependent median increase of up to 2.5-fold in the SMN protein. As described in the presentation, RG7916 remained well tolerated in patients at all doses and there have been no drug-related safety findings leading to withdrawal. Patients remained on therapy for up to 200 days.

The second registration-directed trial, FIREFISH, is an open-label two-part study in SMA type I infants, which is expected to transition to a 40-patient pivotal stage in the coming months. The primary endpoint is the ability of infants to sit without support as assessed by the Bayley Gross Motor Scale. The SMA program has an open label trial known as JEWELFISH. JEWELFISH allows SMA patients from other studies of SMN2 splicing targeting therapies, including our previous candidate, RG7800, to gain access to RG7916.

The SMA program is not only important for SMA patients. It also validates that our splicing platform technology can identify selective compound than modulates this process. We are now utilizing this PTC technology outside of the SMA collaboration. We are internally pursuing additional preclinical program targeting pre-mRNA splicing, including Huntington's disease and Familial Dysautonomia. We will share more about these exciting splicing programs as well as highlighting our R&D pipeline at an upcoming Analyst Day that we plan to hold next year.

I'd now like to turn the call over to Christine Utter, our Principal Financial Officer. Christine?

Thanks, Stu. Earlier today, we issued a press release summarizing the details of our financial results for the third quarter, and I refer you to that release for full detail.

I'll start with a few comments on our financial performance this quarter, which combined with the commercial results generated year-to-date, set us up well for the remainder of 2017. Starting with our top line results, we reported strong performances across both of our commercial assets. EMFLAZA revenue in the third quarter was reported at $9.8 million. The EMFLAZA performance to date has allowed us to increase our revenue guidance for EMFLAZA to $20 million to $25 million, up from $15 million to $20 million for the full year 2017.

Translarna revenue in the quarter was $32 million, a year-over-year increase of 45%. As we noted, Translarna revenue remained strong with growth continuing in both new and existing territories. We reiterate our Translarna guidance of $120 million to $140 million as provided on our last call. This guidance assumes the current exchange rate and the continued commercial expansion for Translarna in nonsense mutation DMD outside of the U.S. This brings our full year revenue guidance in the range of $160 million to $185 million. This guidance includes a $20 million milestone we achieved from Roche in mid-October for the advancement of the SUNFISH trial to a pivotal stage.

We reported a net loss of approximately $33.7 million for the third quarter of 2017, which declined over $1.5 million from the same period in 2016. Our operating losses are anticipated to continue declining as we leverage our existing infrastructure and continue to grow our revenue base, now from 2 commercial products.

Non-GAAP R&D expenses in the third quarter were approximately $26.4 million, relatively flat to the same period in 2016. While we completed the major costs associated with running previous Phase III Translarna studies, the research and development expenses now reflect the initiation of our long-term DMD study, 041, and certain increased regulatory costs. Non-GAAP SG&A expenses were approximately $27.9 million for the third quarter of 2017, an increase of 47% versus the prior year quarter.

SG&A expenses have increased mostly driven by the launch of EMFLAZA. We are reiterating our GAAP R&D and SG&A expense for the full year of 2017 of between $250 million to $260 million. Excluding estimated noncash stock-based compensation expense of approximately $40 million, full year 2017 non-GAAP R&D and SG&A expenses are anticipated to be between $210 million and $220 million. These expenses are expected to be primarily in support of the continued research and clinical development of our product pipeline candidate as well as the commercialization of Translarna outside of the U.S. and investing in the commercial launch of EMFLAZA in the U.S.

Our previous cash guidance was to complete 2017 with approximately $120 million. Due to our increased revenue guidance, we now anticipate ending the year with over $150 million of cash and marketable securities.

I will now hand the call over to the operator to start our question-and-answer session. Operator?

(Operator Instructions) Our first question comes from the line of Joel Beatty from Citi.

First one is on Translarna. In the past, we have seen sales coming a little bit irregularly, it seems like, and probably due to bulk sales in Latin America. Are you able to give a sense of how much bulk sales contributed this quarter compared to the previous quarter? Is it safe to assume that since the bulk sales were high last quarter, that this is a down quarter for that?

Joe, it's Marcio. Thanks for the call. As you know, we don't guide specifically on countries or the regions, but we do expect, moving forward, that orders from Latin America will continue to be irregular and bumpy. I think the important part is here is, really, we are reiterating the guidance for the year, and we don't expect like any impact of a different order coming from that region.

Okay, that's helpful. And then one other question. On the SMA program, I see that the first of the 2 trials has advanced to pivotal with a functional endpoint for the pivotal trial. Is it possible that we could also get functional data from part 1 of either these trials in type I or type II and III patients? And if so, what could be the timing to be able to see that functional data from part 1?

Yes. Thanks for that, Joel. So there is -- as you know, we just transitioned the -- and received the milestone from Roche for the transition of the SUNFISH trial into a pivotal trial that's occurring. And as you know, that's using the MFM as its endpoint. They did collect some results with the part 1 data, and there'll be -- we plan to present results of that in a poster or in a presentation in 2018. So we'll be talking about that data in the -- early next year, probably.

Our next question comes from the line of Tazeen Ahmad from Bank of America.

Still on EMFLAZA, you've obviously had a nice ramp up in your launch. You had a pretty strong growth sequentially between 2Q and 3Q, but your revised full year number for EMFLAZA wouldn't indicate that much more growth in the fourth quarter. Is there an expectation of some impact from the holiday there? Or is there any kind of trend that you can point us through for that? And then I have a question on the SMA program as well.

Sure. Marcio, why don't you...

Sure. Thanks, Tazeen. It's Marcio again. So it's still early days in the launch. As you know, we are at the first 6 months. We're definitively very optimistic and very happy with the results so far. We are raising the guidance. There was pent-up demand. So we know there was a bulk of patients that we transitioned in the first few months. There is no expectation that the bulk would continue. So it's in line with our initial expectations that we are gaining patients, it's going faster than we expected, the transition, so that's why we are raising the guidance.

Do you have any idea of what your penetration is right now in your targeted population?

Sure. We're monitoring that. So we are not going to be giving this guidance or these numbers in this call right now, but that's something we've been looking very closely and we're projecting moving forward.

Okay, great. And then on the SMA program, how do you envision this product fitting into the treatment regimen that exist now with SPINRAZA as well as the potential for gene therapy, would this be in addition to, instead of -- and how can we better understand what the impact of using this drug, let's say, it's in combination with other drugs would be to, I guess, justify what would be a relatively expensive treatment?

Sure. Thanks for that. So as you may, RG79 is an oral drug that distributes throughout the body. So as you may remember that preclinical data was really quite impressive where it promoted the splicing in all the important tissues. And I'll remind you that SMA, while it affects the central nervous system, it affects a whole bunch of other tissues that I described in my initial comments earlier on. And that, I think, one major advantage is that the molecule can go to these -- distribute to multiple tissues and allow SMN protein to go on. So we think while it might not be the first-in-class, we're hoping for it to be potentially the best-in-class in terms of being able to make SMN protein both in the CNS as well as other tissues. In terms of in combination or as monotherapy, obviously, now we're looking at it as monotherapy just to demonstrate its activity, but it makes sense also in time, in due course to consider combinations and what's best for the SMA patients.

Okay. And sorry, the last person might have also already asked you this, but when is the next data readout that we should expect for SMA?

Yes. So I think what we talked about is that we'll be presenting the part 1 of FIREFISH at an upcoming meeting. So expect that to be early in 2018. And I think they'll be talking, again, about the preclinical data as well so people, again, really understand the importance of being able to get SMN drug to other tissues that are important for SMA patients.

Our next question comes from the line of Alethia Young from Credit Suisse.

Maybe a couple. Maybe do -- you can talk a little bit more about the EMFLAZA trends. Maybe -- I guess, I'm more curious about you have the bolus and now, how do you kind of -- what's the hurdles to educating the rest of the people? And also, are there trends around -- more -- doctors are now putting multiple patients on a site or kind of just give us a little bit more about the cadence that you've seen there? And then as far -- I don't know if you answered this, but as far as the ex U.S. opportunity for Translarna, I mean, can you discuss some of the areas where you think you remain underpenetrated?

Sure. So let me -- I'll ask -- Marcio wants to talk a little bit about the EMFLAZA and then ex U.S.

Sure. So in terms of like the types of patients, right? We have seen scripts coming on, on all the different segments of patients for EMFLAZA. So it's been pretty broad. In your question in relation to the doctors, so I think 2 points that are quite important. So one, it's a very broad base that we have right now. Our team has been very effective on having conversations with doctors in both the main, like centers, like the MDA centers, but outside of them as well. We've seen multiple scripts for accounts or seen like a variety of accounts are very happy with how it's coming. As we just raised guidance, it's mostly because, obviously, we are [not just] seeing the number of scripts growing, but also the fact that they're growing faster. So fairly happy with that. Do you want me to...

Yes, and I think also maybe a little bit of discussion on the eduction -- [in effect,] the standard of care, the superiority of the product might be useful there.

Fair enough. That's a very, very important point. Thanks, Stu. So the -- before EMFLAZA was launched in the U.S., there was really no education in markets in terms of the benefits of these patients being on treatment or even the need for some patients. The guidelines, while they were updated, they were very genetic. And what we are doing right now and as we move to the second phase, as I mentioned during my remarks earlier in the call, is really invest on that education, just use a lot more our medical affairs, both staff and resource that we've been using in the initial phase of the launch to answer questions mostly from physicians to actually help with education as well in the field. So both patients were never treated with steroids -- were very large part of the market, it's not small -- but also the ones that are looking for switching therapy have the opportunity to do so because they are more educated. We truly believe on the benefit of EMFLAZA. As we mentioned during the acquisition, we acquired EMFLAZA because we believe that's the best treatment patients should be on, and we continue to generate data and to get this data out there that reinforce our belief.

And I think, as Marcio said, is that since we've -- the acquisition of EMFLAZA, there's been a lot of data that we -- a, we've had that's been able to get out as well as work from the placebo of things like the Lilly data as well as there's going to be a recent or there will be a publication from the, synergy natural history that really shows the superiority of EMFLAZA and that patient should be on this drug. And so I think there's a lot of education that will be occurring with all this new data that is getting out, both in posters and soon to be in the literature.

And maybe to answer your Translarna question, so we just mentioned, like, we're going to be expecting double-digits patient growth next year. This is coming from other regions as well. We -- well, we believe it was a really good job on penetrating like Western Europe, like the main countries; had a very good results in Latin America. We expect to see growth in other regions, including those, as well. But as we move forward, the biggest -- or the smallest penetration, should I say, is in Central and Eastern Europe and the Middle East, and that's where we're going to be focusing as well a lot of the efforts.

Our next mission comes from the line of Matthew Eckler from RBC Capital Markets.

So I wanted to dig a little bit more into your full year guidance. And so specifically looking at Translarna, at the low end of guidance, this actually implies a contraction in revenues of something around 51%, sequentially. While at the high end of guidance, you're implying about a 12% quarter-over-quarter growth. So look, I guess, my first question here is why not move up the low end of guidance? Are you anticipating the potential of a slowdown in revenues in Q4?

So when you're looking through the Translarna guidance, if I understand your question correctly, right, where we are affirming the guidance for this year, is that question you're asking?

It is. It is. So to date, year-to-date, you've done, what, about $104 million in sales, right? And you're guiding for $120 million to $140 million for the full year. So that implies anywhere from $15 million on the low end to $35 million on the high end. And obviously, $15 million in Q4 is a significant decline from Q3. So why not move in -- move up the low end of your guidance? Is there something in there that you could be concerned about a slowing in revenues?

No. There is no major concern that we're having. Again, we are reinforcing the guidance because that's we are looking forward in terms of the mix of patients, the timing, the size of the orders that oftentimes change, specifically as it comes closer to the holidays. So there is no fundamental of the business that is changing. It's really making sure that we give a realistic guidance for you guys that is aligned with our expectations.

Okay. But again, I mean, and correct me if I'm thinking about this is the wrong way, but the low end of your guidance implies a severe slowing in revenues for Q4, is that correct?

The lower end of the guidance, if it we were to be there, would be a smaller-in-size quarter, but that doesn't mean that the entire guidance is, right? So we're guiding for the range, not for the lower end.

Okay. Okay, understood. And then, separately, do your current Translarna revenues or guidance include any inventory build or stocking?

No.

No. Okay, got it. So it's all revenues recorded on a sell-through basis?

That's correct.

Okay. Okay, perfect. Very helpful. And then just kind of one last from me. You mentioned in the press release that you're seeing a greater-than-90% compliance rate for Translarna. So obviously, very, very high compliance there. But for the patients who have discontinued, what are some of the reasons there for discontinuation?

Sure. So first let me just expand a little bit on the compliance rate, right? So this is a therapy they are taking 3 times a day, the young children, some of them are teenagers, like, we have to bring this to school and so on. So when you're looking to 90s, in general, always very good for any drug, but we too, specifically, really, really pleased with the results we are seeing. We believe this is linked to patients really seeing the benefit of that and continue on the drug. So incredible result as we see, in general. We haven't given any numbers in term of discontinuations. The number has been very small and mostly related to patient choice not to continue on the drug in different countries. But the numbers is very small, as I mentioned.

Our next question comes from the line of Raju Prasad from William Blair.

One on Translarna. I felt like at the [Ad Com], one of the biggest points of contention was on the bell-shaped dose response curve. I was just wondering if from the PK study in the children 2 to 5, is there anything that you'd be able to show to the FDA to kind of get them more comfortable with the dose response curve that you guys have explained for Translarna?

Yes. Thanks, Raju, for the question. Yes, the -- I think that, that will just show, I think, in a sense typical PK. But I think more towards your question is, we had done a formal PK/PD response analysis where we did -- in a sense, one of the questions that was asked by -- to the person who's the PK person in terms of, did you do a formal model? And the answer is, yes, we had actually -- it's one of the things that we're pointing out that was missed, is that we had done a formal model that demonstrated -- that's a formal model that they normally would have done, that's a standard procedure that's been done that demonstrates the bell-shaped curve. So I think that model will be included as part of our appeal response that it does -- it's a good example of something that was missed that was important for them to look at.

Great. And then on EMFLAZA, can you just give a little more color on the 1,500 patients as far as the bridging program, maybe just how many are in the bridging program or a general percentage as well as is that where you're seeing the majority of growth in patients quarter-over-quarter?

No, no, that's not where we're seeing the majority of the growth, right? So we're talking specifically between the splits between like merchant shipment and Bridge. The Bridge is something very important for us because in relation to our commitment to get access to all the patients who are being on EMFLAZA or who are in need of EMFLAZA there, so we're really using this. It has been very efficient at the Bridge. So patients are not remaining there. They are there for a period of the time. We're getting new scripts everyday. So that's -- the growth is not coming exclusively from the Bridge, but obviously, some of them are transitioned from Bridge.

Our next question comes from the line of Gena Wang from Barclays.

This is [Parad] on for Gena. Two questions, one for EMFLAZA and one for Translarna. For EMFLAZA, just I was wondering if you could provide some additional color on the launch? For example, any color you can provide on gross to net and cost of sales associated with the launch? And then I have a follow-up for Translarna.

Sure. So I will start with the gross to net. So the gross to net so far has been within our expectations. It's on the mid to high teens. That's pretty much on the blend of we're expecting between private and public figures and also like the discounts that are associated with that -- we're netting out exactly what we are expecting. We don't expect this to move much. That's what was in our regional expectations. So we are happy to see the patients are getting there. In terms of the other details of the launch, we're going necessarily going to be giving them now. I just wanted to reinforce, we're very happy with the patient's growth, very happy that we're being able to keep our promise that no patients who need access to EMFLAZA would not get access. So we are seeing the scripts coming in and we are keeping them on drug either through the Bridge Program or direct shipment from commercial.

Great. For Translarna in the ex U.S., could you remind us the timing for CHMP opinion on the renewal of the conditional approval? And just trying to understand a little bit more about the expansion efforts in Middle East and Central Europe, any, like, specific steps you are taking? Now that the U.S. approval has some other barriers, anything extra that you're going to do there to kind of expand the footprint there?

Sure. So let me start with the renewal procedure for our approval in Europe. So every first quarter we will submit the procedure for renewal. We are on track internally to do that. We're going to be submitting the procedure, just like we did this year, at the beginning of 2018. So we're not forcing any issues with that or that -- it requires like a safe database lock and a few other things, we're going to be doing this. So, again, as they go through, there's a specific timetable you can find in these CHMP timetable in the website and it's going to follow that general (inaudible). In terms of the expansion on the Middle East and Central and Eastern Europe, so I mentioned before in the call about few aspects that we're working on and that we're going to be investing on next year. When you look into that region specifically, there are 2 major components that I would like to highlight to you. So one is education. And while education is not an issue, but I would say a barrier of different magnitude throughout the work and in all regions we are working on, it's specifically important in Central -- in the Middle East, I mean, and CE regions. So we're going to be intensifying our efforts both with ourselves and other partners we have in the region on increasing the education on DMD. The second is access to genotyping. We had a lot of partnerships throughout the globe on getting access to genotyping. We've been very, very pleased with them. We increased the level of full next-generation sequencing a lot since we started launch 3 years ago. But that's one area that, specifically in the Middle East, we're going to be investing fairly heavily next year to make sure that every patient who is diagnosed with DMD gets proper genotyping fast. So if they are eligible to Translarna, and the physician and the patient believe that should be appropriate, that they get access to it.

And this does conclude the question-and-answer session of today's program. I'd like to hand the program back to Dr. Stuart Peltz for any further remarks.

Okay, thank you. I want to thank everyone today for being on the call. And thank you for your questions. As you could see, we're focused on moving forward here and transforming the lives of these patients for better outcome. Thanks for your time today.

Thank you, ladies and gentlemen, for your participation in today's conference. This does conclude the program. You may now disconnect. Good day.