TG Therapeutics Inc (TGTX) 2024 Q1 法說會逐字稿

Greetings, and welcome to the TG Therapeutics conference call and webcast. (Operator Instructions) As a reminder, this conference is being recorded.

It is now my pleasure to introduce your host, Jenna Bosco. Thank you, Jenna, you may begin.

Thank you. Welcome, everyone, and thanks for joining us this morning. I'm Jenna Bosco, and with me today to discuss the first-quarter 2024 financial results are Michael Weiss, our Chairman and Chief Executive Officer; Adam Waldman, our Chief Commercialization Officer; and Sean Power, our Chief Financial Officer.

Following our Safe Harbor statement, Mike will provide an overview of our recent corporate developments. Adam will share an update on our commercialization efforts. And Sean will give an overview of our financial results before turning the call over to the operator to begin the Q&A session.

Before we begin, I'd like to remind everyone that we will be making forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. These forward-looking statements include statements about our anticipated future operating and financial performance, including sales performance, projected regulatory or clinical milestones, revenue guidance, development plans, and expectations for our marketed products.

TG cautions that these forward-looking statements are subject to risks that may cause our actual results to differ materially from those indicated. Factors that may affect TG Therapeutics' operations include various risk factors that can be found in our SEC filings.

In addition, any forward-looking statements made on this call represent our views only as of today and should not be relied upon as representing our views as of any later date. We specifically disclaim any obligation to update or revise any forward-looking statements. This conference call is being recorded for audio rebroadcast on TG's website, www.tgtherapeutics.com, where it will be available for the next 30 days.

With that, I'd like to turn the call over to Mike Weiss, our CEO.

Great. Thanks, Jenna. And good morning, everyone, and thanks for joining us on today's call.

2024 is off to an exciting start, and I'm incredibly proud of the accomplishments already achieved this year. Company-wide, it feels like we are firing on all cylinders. A prime example was the recent announcement of the award of the VA contract for BRIUMVI as the preferred anti-CD20 for the VA system.

We cannot be more excited to be able to support our veterans with multiple sclerosis by offering BRIUMVI at a deep discount. We see this as a great way to serve our veterans, introduce BRIUMVI to additional health care providers, many of whom split their time between the VA and their academic appointments, and of course, generate incremental revenue.

As for the first quarter, the demand for BRIUMVI was extremely strong, and I'm pleased to report that the US BRIUMVI the revenue was in excess of $50 million, and total revenues for the quarter were over $63 million, which includes milestone payments received from our ex-US partner. By any measure, it was a robust revenue quarter for TG.

As mentioned previously, starting in late 2023 and continuing, we have significantly increased our investment in patient awareness activities and strategically increased the size of our commercial team. I have to believe these investments contributed to the strong first-quarter results.

More broadly, our team continues to be focused on our long-term goal of becoming the number one prescribed anti-CD20 from a dynamic market share perspective. And the feedback from physicians, patients, nurses, and infusion centers continues to drive our confidence that that is achievable. We believe that BRIUMVI has best-in-class profile that should help us get there.

BRIUMVI is the only anti-CD20 monoclonal antibody that can be given as a one-hour infusion every six months following the starting dose. And it's the only anti-CD20 monoclonal antibody in Phase 3 trials to achieve an annualized relapse rate of less than 0.10. Also, in Phase 3 trials, the BRIUMVI one-hour infusion was generally well tolerated, with 95% of the one-hour infusions being delivered on time.

Beyond the clinical data, BRIUMVI is also differentiated by design, having been glycoengineered for enhanced immune effect or cell engagement and efficient B-cell depletion. As previously presented, preclinical data demonstrates that compared to the other anti-CD20s approved or used to treat MS, BRIUMVI has the highest binding affinity CD20, the target found on the B-cells, and through its glycoengineering, has the ability to induce the highest level of antibody-dependent cellular cytotoxicity.

We look forward to evaluating these preclinical differences further to assess what, if any, contribution then they have to BRIUMVI's differentiated clinical profile. And we will seek to share these data when available.

We're also excited to share during the quarter that there were three newly issued patents, US Patent and Trademark Office, extending patent protection for BRIUMVI through 2042. With the extended runway, our development team is focused on potential expansion opportunities for BRIUMVI both within MS as well as in other autoimmune diseases.

To that end, we are focused on BRIUMVI-related initiatives this year, which we believe could drive significant future value. First is further improving the convenient dosing of IV BRIUMVI. In March at the ACTRIMS Conference, we presented updated data from the ENHANCE trial, evaluating the safety and efficacy of eliminating the four-hour BRIUMVI 150-milligram starting dose for patients who switch from a prior anti-CD20.

Data presented suggests that beyond the was well-tolerated for patients that skipped the starting dose and went straight to the first full 450-milligram dose, given as a one-hour infusion. These early results are encouraging, and we look forward to continuing to present additional efficacy, safety, and tolerability data from this study throughout the year.

Second is the development of subcutaneous BRIUMVI. We believe the subcu CD20 market is distinct from the IV market and believe this could represent a significant additional opportunity for BRIUMVI. We are preparing to enter human bioequivalence study in this year and look forward to providing additional updates on this front as we have them throughout the year.

And third, we look forward to evaluating BRIUMVI in other autoimmune indications. The goal is to launch our first autoimmune trial evaluating BRIUMVI outside of multiple sclerosis later this year. We believe the expansion of BRIUMVI represents a significant opportunity, and we look forward to providing updates throughout the year.

But we are not stopping there. The future of TG also lies in the expansion of our portfolio. We recently entered into a partnership with Precision BioSciences to acquire worldwide license to Precision's azer-cel, an allogeneic CD19 CAR T-cell therapy for autoimmune diseases and all other non-oncology indications. We believe azer-cel has the potential to be a first-in-class, best-in-class treatment for certain autoimmune diseases. And we look forward to commencing a clinical trial this year.

I also want to congratulate our partners at Neuraxpharm on their launch of BRIUMVI in Europe, which also occurred in the first quarter with the first commercial sale in Germany. Transitioning the program to enable their timely launch took significant effort from our team. And I'm proud of how everyone worked so closely together to make it happen.

The Neuraxpharm team is experienced, motivated, and focused. And we look forward to hearing more from them as the launch progresses to multiple countries across Europe and then around the globe.

Finally, I want to thank and acknowledge the entire TG team. It's amazing to see the focus, attention, and care that TG-ers take to ensure the best possible experience for patients with MS. While we spend a lot of time on these calls talking about numbers, the most gratifying part of my day is hearing firsthand from patients taken BRIUMVI of the positive experiences as well as HCP's anecdotes about their patients' treatment successes with BRIUMVI.

With that, let me hand the call over to Adam Waldman, our Chief Commercialization Officer, for a detailed update on the BRIUMVI US commercial launch. Adam, go ahead.

Thank you, Mike, and good morning, everybody. I'm excited to provide insights into our continued commercial progress in the first quarter. This was another very strong quarter of performance, exceeding our revenue guidance and all of our key performance metrics.

Our focus on delivering BRIUMVI to patients remains unwavering, and I'm pleased to share our progress with you today. In the first quarter of 2024, we continue to see strong uptake of BRIUMVI in the market. As reported in our press release, first-quarter net sales in the US for BRIUMVI were $50.5 million, representing 25% growth quarter over quarter.

The first-quarter number exceeded our original guidance of $41 million to $46 million provided in early January as well as our updated guidance we provided in late February. The trends we saw early in the quarter continued throughout the quarter, reflecting strong and growing demand for BRIUMVI.

This growth is particularly impressive given the first quarter challenges associated with beginning of the year payer dynamics. In fact, we were the only CD20 in MS to see revenue growth quarter over quarter in the US market during this timeframe.

Equally impressive is that we also saw enrollments grow by approximately 25% with over 1,250 new patient scripts received by the TG hub in the quarter. I want to congratulate our team on doing an exceptional job preparing for the inherent insurance-related challenges seen in the first quarter and mitigating the potential impact.

Since launch, we've implemented a comprehensive commercial strategy that encompasses targeted educational initiatives, engaging health care providers both virtually and in person, and leveraging digital marketing channels to reach a broader patient audience. Our efforts have resulted in increasing uptake of BRIUMVI with health care providers recognizing the value BRIUMVI brings to patients.

Concurrently, ensuring patient access to BRIUMVI remains a top priority for us. We continue to receive exceptional feedback on the comprehensive patient support programs we have introduced to assist patients in navigating reimbursement challenges and accessing the treatment they need.

We also continue to make significant strides in expanding our market presence. Through targeted marketing initiatives and effective sales force deployment, we successfully penetrated new accounts and prescribers driving sustained growth. We saw both increasing number of repeat prescribers and impressive gains in new prescribers with approximately 160 new prescribers in the first quarter, the majority of which were from academic centers.

We also continue to convert new centers, adding 65 new accounts in the quarter. To date, we have seen broad adoption of BRIUMVI across the US with new prescriptions coming from over 450 centers and over 800 unique prescribers.

Encouragingly, we also continue to see a diverse mix of patient types, including those that are naive to all treatments and those that were previously treated and switched from both non-CD 20 and CD20 agents. This makes the patient types continue to be fairly consistent quarter to quarter with the largest group consisting of patients that were previously treated by naive to anti-CD20 therapy.

2024 is off to a really strong start. We achieved record BRIUMVI new patient enrollments into our hub in the first quarter and far exceeded our first-quarter revenue guidance and continued to show strong quarter-to-quarter growth despite the first-quarter insurance headwinds. We continue to see momentum building into the second quarter. And based on the information we have available at this time, we are targeting BRIUMVI net revenue of approximately $65 million for the second quarter.

In terms of the (technical difficulty) of the full year, we continue to feel confident about the BRIUMVI trajectory. Based on current trends, we believe we are tracking above the top end of our original guidance of $220 million to $260 million and are therefore raising our full-year guidance to $270 million to $290 million.

Looking ahead, we see promising opportunities for further growth and expansion. We believe we are poised to broaden our reach and make an even greater impact on the MS patient community. We continue to believe BRIUMVI's profile remains very compelling and will eventually be the IV therapy of choice in the relapsing MS market.

In conclusion, I want to thank our team for their dedication and hard work. They have executed the launch plan with precision, driving awareness and adoption among our targeted health care providers. And we believe their outstanding efforts are contributing to the positive experience with BRIUMVI and confidence in our organization.

I also want to thank the health care providers and their patients for their trust in TG Therapeutics. Together, we will continue to improve outcomes for those in need, and we certainly have more work to do. But we are focused and extremely motivated to continue to work every day to bring BRIUMVI to those people living with MS and their families.

With that I'll turn the call over to Sean Power, our CFO. Sean?

Thank you, Adam, and thanks, everyone, for joining us. Earlier this morning, we reported our detailed first-quarter 2024 financial results, which can be viewed on the Investors and Media section of our website.

This morning, I'll start with a discussion of our revenue. We are pleased to report total revenue of approximately $63.5 million during the first quarter of 2024, which as previously mentioned, includes $50.5 million of US BRIUMVI net product revenue. Also included in our Q1 '24 revenue is total is approximately $13 million of license, milestone, royalty, and other revenue, which consist primarily of the $12.5 million milestone we received from our ex-US partner for the first commercial launch of BRIUMVI in EU.

Our OpEx during the first quarter of '24, despite some one-time charges, has remained well-controlled and in line with previously discussed ranges. For the first quarter of '24, our operating expenses were approximately $58 million, which includes one-time charges to research and development expenses of approximately $8.8 million related to our agreement with Precision BioSciences for the in-license azer-cel program.

During the first quarter of '24, we also saw a modest increase in R&D expenses driven by manufacturing and development costs associated with our ublituximab subcutaneous development work. On the back of the reported revenues and well-controlled OpEx, during the first quarter of '24, we reported a modest net loss of approximately $10.7 million, or $0.07 per share compared to a net loss of approximately $39.2 million for $0.28 per share during the comparable quarter in 2023.

From a cash standpoint, we ended the first quarter with $209.8 million in cash, cash equivalents, and investment securities, down less than $10 million from Q4 of '23. We believe our current cash position coupled with our previously guided revenue and expense guidance provides us with sufficient capital to fund our operations to cash flow positivity.

With that, I will now turn the call over to the conference operator to begin the Q&A.

(Operator Instructions) Michael Difiore, Evercore.

Hi. Good morning, guys. Thanks so much for taking my question, and congrats on all the great progress this quarter. A couple for me, regarding sales in EU, I know it's very early, but when could we expect Neuraxpharm to begin offering details? And I have two follow-ups. Thank you.

Yeah. So in terms of Neuraxpharm providing public details, I think we're a long way off their private company private equity backed. So I don't anticipate they'll be providing any public guidance or information to my knowledge. Adam, anything different from your side?

No. No, nothing to add there.

Okay. Fair enough. And another two questions are how much of BRIUMVI's fiscal year '24 guidance raise was due to the recently announced VA contract? And any color that you can provide on pricing or increased rebating in the segment? I know you said it's heavily discounted.

Yeah, Adam, go ahead.

Sure. Yeah, the revenue raise was really -- the VA was not really factored in for a couple of reasons. One, this won't go into effect until June. Second, it will be a gradual increase as new patients get on. Patients will only really have the opportunity in this year to have the first two infusions at best.

So it will be a gradual increase. And it wasn't really a factor in the way that we looked at raising our guidance. The guidance was raised based on the demand trends that we're seeing. First pricing, I think that's out there in public. We offered about a 72% discount, roughly about $2,900 a vial.

Okay, great. And my last question is this, in the most recent cut of the enhanced data presented at ACTRIMS, three patients in cohort two had to have their infusion slowed down or interrupted. Any color on these patients? Like how long would these infusions slow down to or interrupted for? And were there any unique clinical features of these patients that could explain this?

So no, I don't think there was anything particular about the patients. But the infusions slowed were pretty modest. And I think all were done reasonably close to the one hour anyway. So no, I think it was just basic stuff, typical one for other infusions. But I don't think there's anything to be worried about there. It was well tolerated overall, and those patients too did well.

Got it. Thanks so much. Congrats again.

Ed White, H.C. Wainwright.

Good morning. Congratulations on the results, and thanks for taking my questions. Just to clarify what you just said on the VA contract, Adam, was it a 72% discount?

Yes.

Okay. Thank you. And this has been brought up before, but I just wanted to address it again. Thinking about the potential opportunity in the so-called crap gap with Ocrevus, is this something that you think you'll be able to produce data on or somehow address this with your sales force?

Yeah. So in terms of crap gap and being able to show, I mean we'll try to capture as much data as we can through the ENHANCE study. I think the number is about 50% to 60%-ish, maybe a third, two-thirds report crap gap as they're coming into the ENHANCE trial. So we'll try to capture some of that information on the back end, which we'll have at least some anecdotal information about patient reported, whether they are or not seeing a crap gap.

It's hard -- there's no scale to objectively measure crap gap. There's no -- it is a challenging thing to measure, but we'll do the best we can within the ENHANCE study and whatever studies we conduct. We will certainly try to parse out the effect and whether we've changed that for patients.

Okay. Thanks, Mike. And just -- when thinking about other potential indications, how do you prioritize outside of MS? I'm sure you have plenty of factors in there, but where does time to potential approval come in or size of the potential market? How are you sort of ranking that?

Yes. I mean, I think, look, we're probably focused on things like RA and lupus for BRIUMVI outside of MS sort of larger indications. And as we've said previously, in some more niche indications, we would be looking at azer-cel.

Okay, Mike. Thanks for taking my questions.

Thanks, Ed.

Roger Song, Jefferies.

Great. And my congrats to the 1Q results. And then just a couple of questions from us. One is the understanding your hub is capturing mostly the new patients, in the given you have quite a few quarters since launch. So how would you characterize the repeat infusion rate you have been seeing?

Yes. Adam, do you want to go ahead on that one?

Yeah. So yes, just to reconfirm here, the patient hub numbers that we're giving you are new patients only. So just to -- I think that was your question there. And then as far as persistence, we would say we're still early in the -- with our data. And we continue -- however, the data that we see, we continue to see that the 24-week persistence is in line or maybe slightly better than our expectations of about 85% week 24. So we feel pretty good about it. Although the data is early, we'll continue to look at it. But right now, it's in line or maybe slightly ahead of what we expected.

Excellent. Thank you. 85%, that's good. And then so you are having now 100 health providers at around 450 centers. So understanding where you'd start to -- where you tend to launch, you are targeting top 50 accounts covering 70% to 80% of MS patients. Just curious if that's still the goal for the provider or the center outreach. And then if that's the case, when do you expect you will achieve that final 50 from the 450?

Yeah. So I think if I understand the question is what's our goal in terms of new accounts and new prescribers? I'll just say that I think we've done really good. We've got broad adoption right now, but we certainly see opportunity for more adoption with even more prescribers and, of course, deepening the use with our current prescribers.

The good news in the quarter is we saw increases in both repeat prescribers and adding new prescribers at a pretty good clip and new accounts at a pretty good clip. So we feel good about it. We're continuing to make progress every day and certainly have opportunity but feel good about where we are at right now.

Great. Thank you. One last question related to the financials. So I think earlier this year, you're guiding the OpEx is $250 million for the year. Just wanted to confirm if that's still the guidance for now. And then also curious about the expectation for the coming years, given you're continuing to launch and expanding your pipeline? Thank you.

Yeah, I'll take a first crack, and Sean, jump in. But yeah, I mean, I think we're well on track to set approximately $250 million in OpEx. It gives us a little wiggle room there. But if you look at even the first quarter, we had $58 million in change, and we had $8 million in change, which was that one-time to Precision.

So the base OpEx was totaling around $50 million for the quarter. So you multiply that times four, you're still well under the $250 million. That gives us room to grow, and we are growing. Like I said in my prepared remarks, we're strategically adding to our team, and we're continuing to spend money on patient awareness programs. But I think from where we sit today, we're in pretty good shape.

Sean, any more details there?

Yeah, I think you I think you covered it pretty well, Mike,

Great. Thank you. That's it from us.

Matt Kaplan, Ladenburg Thalmann.

Hey, good morning, guys. Congrats on the quarter. So maybe for Adam, in terms of new patient starts, can you give us a little bit more detail in terms of where they're coming from, in terms of naive switch, and the background that you're getting from the patients here?

Yeah. Thanks, Matt. Good morning. So I would say we have not given out specific percentages of the patient and how it exactly breaks out. What we said is the biggest group is patients switching from non-CD20s, but we also have good representation from treatment-naive patients as well as patients that are switching from CD20s like Ocrevus or Kesimpta.

So we're getting a -- encouragingly, we think we're getting a nice diverse group of patients and importantly, staying consistent quarter to quarter. There's wasn't any sort of big boluses of a certain patient group that sort of diffused over time. So we're seeing consistently representation from all three of those groups.

Okay. That's helpful. Thanks.

And then I guess in terms of the subcutaneous opportunity for BRIUMVI formulation, I guess recently on the Roche call, they said they see the subcutaneous opportunity as more than $2 billion. I guess question is with your potential differentiated profile, what's your assessment of the subcu opportunity?

Yeah. I'll speak broadly, and I'll let Adam chime in. I mean, look, the folks at Novartis have done a really nice job of carving out a subcu market. They created it. And I think as very strongly mentioned, Novartis is probably over $2 billion and growing today. So there's a nice market there.

I mean, our goal is to come into that market with a very competitive profile product. As we've said previously, we understand the parameters. We've got on the one hand a relatively elegant auto-injector once a month, and you've got a relatively bulky product every six months. Somewhere in the middle we think is an optimal product design, and we're going to trying to get there.

So I think from just where we sit today, we're seeing opportunity and we're going to take our best crack at it. Adam?

Nothing else to really add there, Mike.

All right. Sorry about that.

All right. Thanks for taking the question, guys.

Thanks, Matt.

Mayank Mamtani, B. Riley Securities.

Good morning, team. Congrats on a strong quarter, and thanks for taking our questions. Sorry, I don't know if I missed this, did you say the revenue split of between new patient starts and maintained inflations? And I was also curious to hear from you how you think that stocking up effect in second half, how we should expect that revenue split could be?

And if you can also comment on some other metrics you provided before, free drug percentage, gross to net. Anything on that would be helpful as we think about the full-year modeling. And then I have a couple of follow-ups.

Yeah, we didn't share. You didn't miss it. We didn't share any specifics on new versus continuing patients from a revenue perspective.

We do continue to feel that they know this is a market where duration is a big driver of revenue, and there will be a pancake effect that will as time goes patients will -- this is a very sticky. The duration is really good; patients are on drug an average of five years. So you will see that pancake effect over time. So that's the best that I have for that question.

I think your other questions was free drug. As I said before, we did expect free drug rates to come down. We are seeing free drug rates come down. I think in the first quarter, we're about 12% is -- right now, I think it's about 12%. From earlier in 2023, we're about 20%. So 12% in the quarter.

And then from a gross to net standpoint, I think what we said previously is our gross to net is approximately 75% will go up and down from quarter to quarter. But 75% is probably a good number to use for the remainder of 2024.

Thank you. That's helpful. And then your updated guidance for full year, I was just curious to learn how are you thinking about that year-end exit market share? Again, like, I don't know, if you think of the market as total NRx percentage, which, Mike, I think you provided. You're tracking at that 10%, but obviously curious to hear how you think about that market share in terms of either total RMS patients or within the anti-CD20 drug class patient? Like, could you just give us some color on how -- what that $280 million midpoint assumes in terms of market share?

Yeah. Mayank, I'm probably not going to get into any specifics. I mean, our goal here is to increase the depth of the use and the breadth of the use and continue to add new prescribers. We see continued opportunity for growth. We feel very confident in the trajectory. We feel very confident in the demand trends that we're seeing.

And we're going to continue to focus on growing the usage of BRIUMVI across the market. And we're doing a great job of it. And based on our guidance here, we obviously feel very confident in continued growth going forward.

Yeah. Mayank, if I --

Go ahead.

Yeah, I'm just going to chime in on the first question asked about the revenue split, new versus old. I know we're not providing actual numbers, but I think it's worth just to mention that in the early years, we're going to be driven by new starts, and the later years will be driven by the ongoing or stacking patients.

So if you look at probably our competitive IV CD20 that's been on the market for a long time, the vast majority of their sales are going to be based on continuing patients, not on new patients in any particular quarter, whereas I'd say we're probably the opposite still, right? We're still reliant on our new starts. But over time, the continuing patients sort of take the commanding role in how the revenues stack up.

Yeah. And that bodes well for that size and that pancake downstream.

Yeah.

I guess last question on the subcu target product profile, Mike. Just would be helpful to understand how you -- even from the KOL feedback now that we know what the subcu profile for Ocrevus would look like at launch now that all the data is out there. I was just curious, Mike, as you design the human bioequivalence study, what differentiating attributes are in mind as you think about that product profile? And thanks again for taking our questions.

Yeah. So look, the Ocrevus subcu is not a true patient-administered at-home product today. So that is yet to be created -- or not created, but to be available or are even studied as far as my knowledge. So that's still yet to come. I mean, our goal is to have something that is a patient-administered, patient-friendly product, again, more along the lines of what was done with ofatumumab.

So I don't know how much market sale. And we think there isn't a lot of room to thread the needle here and come up with a product profile that accomplishes the goals of being both convenient and easy to use.

Got it. Look forward to some of those updates. Thanks, Mike.

Thank you.

Prakhar Agrawal, Cantor Fitzgerald.

Hi. Good morning, and thanks for taking my question, and congrats on the quarter. So just following up on the subcued BRIUMVI question, I'm trying to balance, like, what's your base case assumption on where the dosing frequency could land for subcued BRIUMVI? I guess the reason I'm asking is if it ends up being once a month, would you still go ahead with the subcu development? And I had one more.

Yeah. I mean, I think the bottom line is we probably would, but I don't think that's going to be necessary. So I don't know if that's a scenario that is likely. But yeah, I mean, it's early to tell. And again, I think if we feel like we've got something that is a good opportunity to make a dent in the market, we'll go forward.

And certainly, a once a month could be -- could have some impact in the market. Obviously, it probably has less impact than something that has a less duration, and we'll do the math on that in that illustration, less frequency, but I'm not so concerned about finishing here.

And when do you expect patients to be dosed for subcu BRIUMVI?

We would hope to have first patients dosed within the first half of this year, so hopefully in the next few months here.

And lastly, from my side, we're seeing a lot of data on CD19 antibodies and other autoimmune indications. What's your view on CD19 versus the CD20? and obviously, there's a theory that targeting CD19 could achieve broader coverage of the B-cell compartment compared to, let's say, a CD20. So just wanted to get your perspective there, and do you have a CD19 in early-stage pipeline?

Yeah. I mean, we do have a CD19. Our azer-cel CAR T therapy is a CD19. So we think CD19 is a great target. We think -- it's hard to know if the broader coverages are positive in all settings. There are some diseases that are characterized by plasma cells that may be impacted by CD19 or maybe expressing CD19 where that may be helpful. Animal is one that that folks talk about quite frequently as more potentially CD19 driven.

So we think there are areas where CD19 may be helpful. But overall, we think the overlap between CD20 and CD19 is going to be hard to distinguish in most diseases. And the CD19 when they hit -- it hits pre-B cells in addition to B cells. CD20 hits mature B cells. So in terms of recovery, you may see a difference there.

So I think there's a lot of things to balance when you think about CD19 versus CD20. But from an activity standpoint in most diseases, I don't believe you're going to see a material difference.

Yeah. And just, Mike, one clarification, I was asking about the CD19 antibody, not the CAR T. Do you have a CD19 antibody in early stage in preclinical?

We don't. I don't find that to be a product of interest to us at this time.

Got it. Thank you.

Eric Joseph, JP Morgan.

Hi, good morning, guys. This is Noah on for Eric. Thanks for taking our question. We were just wondering if there were other exclusive procurement opportunities similar to the contract that you just secured with the VA?

Adam?

Not sure I understand the question. Could you clarify?

Yeah. We're just wondering if there are and other opportunities for tiered or exclusive access contracts with other providers going forward.

Okay, got you. Understood. I don't have any updates at this time on that question.

Got it. Thank you.

Corinne Jenkins, Goldman Sachs.

Good morning. So maybe a couple of questions from us. One, it strikes me that you guys are probably close to reaching profitability in the next quarter or two given and the revenue guidance versus the OpEx guidance. How are you thinking through profitability versus ramping or expanding your R&D or SG&A spend to support the launch and future development?

And then from a technical perspective on the subcutaneous formulation, I guess, what else is left to do before you're able to enter the clinic? Thanks.

Sure. So thinking about profitability, I don't think those questions you asked are mutually exclusive or coincide. So we have -- we will continue to invest in the BRIUMVI launch. We've noted that we've had an increased budget in OpEx to approximately $250 million for the year. So there's some room there to even grow.

From a product standpoint, similarly, we are interested in continuing to build among the BRIUMVI opportunity, the azer-cel opportunity. And we've said that we'll continue to look for additional external opportunities. So I don't know that we're fixated on the exact profitability numbers. I know that may as EPS becomes something of interest, but I don't think that's mutually exclusive. And I do think we plan to continue to grow our BRIUMVI efforts in our team and continue with our R&D platform.

But as an overall company, I think our cost structure versus most other companies, not all but most, is pretty modest. And we've kept a pretty lean chip. So I think the consequence of that is we'll be at profitability probably sooner than most companies would, given the circumstances.

In terms of the subcu technical aspects before entering the clinic, I think we're pretty much over most of the technical hurdles. I think we'll be able to get into the clinic, I believe, in the next two months or so. And I think there's a continuing effort to make continued improvements in what we're working on, which will all just be filtering into the program. But I don't think there's any technical hurdles right now just getting going.

Thank you.

Thank you.

Thank you. We have reached the end of our question-and-answer session. And with that, I would like to turn the floor back over to Mike Weiss for any closing comments.

Great. Thank you, everybody. One second here. Well, okay. So I just wanted to thank everyone for joining us today. Hopefully, everyone has been able to see the excitement and enthusiasm that we have here at TG and what's going on with the company.

The first quarter was quite good in our opinion. We think everything went extremely well, and we look forward to continuing to push forward and achieving more as we move forward into the remainder of the year. Again, we thank everyone for their support. Most importantly, we want to thank the clinicians and patients who definitely put their trust into TG, the whole team does appreciate it.

With that, I'd like to thank everyone for joining us, and have a great day.

This concludes today's teleconference. You may disconnect your lines at this time. Thank you for your participation.