Amicus Therapeutics, Inc. (FOLD) Earnings Call Transcript & Summary

[Audio Gap] The development for Pompe disease, and that's slated to read out early next year. And then we have a broad gene therapy pipeline, importantly, 2 clinical-stage programs in CLN6 and CLN3 Batten disease and a number of additional programs in preclinical development. And in such a strange year, it has been this year, it's been a great year so far for Amicus, even in the face of COVID and the global pandemic. Galafold, as I mentioned, is on track from a revenue perspective. Our Pompe program, we've been able to maintain the integrity of that study and really looking forward to seeing that readout and continue to progress the other programs as well. So for the first half of the year, we've seen strong performance in our business and across our business and look forward to continued performance in the months ahead.

Okay. Great. So let's dive into some detailed questions. Let's start with your commercial platform. So of course, you have Galafold on the market now worldwide to treat Fabry. As you said, you reiterated your guidance $250 million to $260 million for sales this year. And could you discuss some of the dynamics in the U.S. and maybe even in EU that you're seeing as it relates specifically to COVID? And again, you've talked about feeling very confident about the guide, but what sort of metrics did you take into account to get comfortable?

Sure. Yes. It's really sort of 2 pieces, I think, that are important here just from an overall backdrop. And then we can talk about some of the specific metrics we look at. So first, we really came into the year with a lot of strong momentum, which is great. And what we've seen is that Galafold in the markets where we've been present the longest, so especially the European markets, we really are now the standard of care for patients living with amenable mutations in Fabry disease. And we're seeing in countries like the U.K. and in Germany, shares of treated amenable patients, so market share in the amenable population of 70% or even 80%. So really driving strong performance there. And I think that foundation of trust and of momentum is so important because, as you come into the context of this year, which has been so strange for all of us, I think turning to an alternative therapy like Galafold and being able to trust and have to experience what has been an important part of the performance this year. As we came into really kind of the end of the first quarter and really throughout the second quarter and even now in the third quarter, I think what we saw is this kind of a rolling impact of COVID throughout the health care system, of course. And I think what's really unique and important about Galafold is that, as a reminder, it is an oral therapeutic. The standard of care prior to our entrance in the market was an infused product enzyme replacement therapy. And so what we did see was we saw some increased switching and some increases in new patient starts. Because it awarded Fabry patients an ability to really avoid interactions with health care and infrastructure. So whether it was going into an infusion clinic or going into a hospital infusion setting or even having an infusion nurse come into the home, I think that gave us some tailwinds, if you will, to be able to support continued use of Galafold. And supply chain is very easy with this product. It's easy to ship. It comes in a small box. It's very stable. We even had instances where we had some of our team can deliver boxes of Galafold when the infrastructure was really limited in some of these countries. And so that meant that even during the worst of the crisis, we saw new patients come on and patients switch in Italy, Spain, U.K., U.S., Japan. So that really, I think, gave us some tailwinds in what is certainly an environment of some headwinds. And in particular, there were instances where hospitals shut down or physicians stopped prioritizing some of these longer progressing diseases. And I think that kind of tailwind that I described before helped us overcome what is inevitable kind of different rolling shocks to the system. And so now as we sit with almost the full third quarter under our belt, we are confidently reiterating our guidance for the end of the year. Specifically, to talk to what do we look at, one of them is we continue to look at compliance and adherence. And what we've seen is that we have maintained from launch, 90-plus percent compliance and adherence rates. So when people go on to Galafold, they stay on to Galafold. So that's really important. And I think it's been a nice steady bar for us, and that's continued this year. We look very closely at the rate of switch versus naive. And what we've said is at launch, we focus on switch patients, and that's because they're captive in the system. They're coming in every other week to get their infusion. They already convinced the payer that they have Fabry, and it's worth reimbursing for, so there is really a competitive switch. And so in countries like the United States and Japan, where we've launched only in the last couple of years, it's still very much a switch story. And that's kind of 65-35. Whereas in more mature markets like, again, U.K., Germany, some of the EU 5, it's more like 50-50. So we're bringing on about as many diagnosed untreated patients as we are switch patients in those markets. And what we would see is, over time, that, that should actually reverse. Eventually, I think we'll end up bringing on more diagnosed untreated patients. So that dynamic is happening as well. And then, again, maintaining the supply chain, we've actually pushed product from what used to be a regional depots down to the country level, and we hold about 6 months of inventory now at the country level, so that we can ensure that we can maintain the supply chain, even if you have kind of these rolling shock, infrastructure shocks that we've seen in some other markets. So those are some of the things that we look at to make sure that we're on track. And again, with almost the full third quarter under our belt, we're reiterating that guidance for the year.

Okay. Great. Now as it relates to these percent of sales from geographies, about 1/3 is coming from the U.S., how should we be thinking about that on a go-forward basis? Can you give us an idea of what percent of the U.S. market you think you've penetrated? And how much more realistically you have left to tap into?

Sure. So globally, the Fabry is about a $1.5 billion market. And the U.S. is around 35% of global sales, so $500 million plus in sales. And what we've seen in each market is that there are typically about an equal number of diagnosed untreated patients as treated patients. So we're growing these markets as we're encouraging people who maybe were refraining from the non-ERT to come on to Galafold. And at the end of last year, as an example, we said we had over 1,000 patients on Galafold globally. 300 of them were previously naive to treatment. So we are growing the market, which is great. That geographic distribution of revenue, right now, as you said, we're a little closer to 70-30, and I would say that over time, kind of a steady state, we'll probably approach kind of the same distribution that we see with the ERT, so that's more 65-35. But remember, we are continuing to add new geographies outside the U.S. Even though they may be smaller countries, none of them are as important as either Japan, U.S., Europe. But -- so that kind of exact distribution bounces around a little bit. But generally, this year, as you said, it will probably be about 1/3 of the sales will come from the U.S. And in the long term, we think it will kind of even out to about 35% to change.

Okay. So let's move on to a pretty meaningful catalyst for you guys upcoming next year, Pompe. So data from this Phase-III PROPEL study is due in late-onset Pompe is expected in the first half of the year. At this point, are you able to give us any more granularity beyond the first half of next year? That's question one. And then question two is, what data should we be expecting to see at that top line readout?

Sure. I can frame the first part, and then, Jeff, you can go into the detail. So yes, we're very much looking forward to seeing the data from the PROPEL study, eagerly anticipating seeing those data and full speed ahead on launch prep, which I know we'll get into a little bit later in the conversation. But so just to give you a sense of kind of what dictates when that will fall. So last patient last visit in the study is scheduled for December. They have a couple of week kind of buffer on either side on when they can come into that last visit. So the first trigger point is when actually you take the last assessment in December for that patient. So that kind of starts the clock. And it's typically 1.5 to 2 months to do the data queries, to lock the database and then analyze the data and then be able to share it with the community. And so we're doing everything we can to make sure we can pull that as soon in the first half as possible. That being said, in the context of COVID, if that stretches out a little bit, TBD, and that's why we're not quite ready yet between seeing the last patient come into the last assessment and then just evaluating how quickly we can get the queries we need from the sites. We can't give precise guidance, but we're confident it will be first half. And again, we're doing everything we can to bring that forward. Once we have a clear picture for when we can share those data, we'll, of course, update everybody. But Jeff, do you want to talk about exactly what will be included in that data set?

Sure. Thanks, Brad, and thank you, Tazeen. So real quick on background on PROPEL. So we enrolled 123 patients into the study. That actually was over-enrolled from the target of 100. It's 2:1 randomization of AT-GAA versus standard of care. It's stratified by ERT-naive patients, and ERT-switch patients. We enrolled about 75% ERT-switch patients, and they all have been on standard of care at least 2 years, which means that they're in that sort of decline phase that we've seen on long-term standard of care. Primary endpoint is 6-minute walk. Study is very well powered for that primary endpoint. Based on all the variability that we've seen across studies, we estimate a difference of 15 or 20 meters between groups will yield statistical significant superiority. We have lots of key secondary endpoints, of course, forced vital capacity, but other measures of muscle strength, pulmonary function, biomarkers, quality of life will all be assessed. I mean the real goal of the trial is to hit superiority on 6-minute walk, but also to show differentiation across all those other endpoints. We have seen a really consistent response across all those endpoints in our Phase II program and expect to see a good differentiated product from PROPEL. And as Brad mentioned, as soon as we have top line data, we will certainly present that 6-minute walk at DC. And then, of course, we would have the full data at a medical conference as soon as possible.

Okay. And so on those primary endpoints that you're looking at, is it simply enough to be statistically significant? Or do you think that doctors have a particular number in mind that they would want to see to be clinically meaningful? That's the first part of the question. And then secondly, can you talk to any differences between the data that we've seen so far for your earlier-phase studies versus the trial design used in PROPEL?

Yes. So in terms of what's viewed as clinically meaningful, it's actually pretty close to sort of that 15- to 20-meter difference I mentioned that you need to hit for statistical significance with our study design. It's in that low 20s. It's generally viewed as clinically meaningful. It hit Pompe for 6-minute walk. So if we hit statistical significance, we're very likely to also hit what's considered clinically meaningful. Really, in terms of differences between our Phase-II and PROPEL in terms of the types of patients they're very aligned, so we think everything we've seen in terms of magnitude of effects and variability from our Phase II, which we use for our design assumptions and PROPEL still carried forward. If anything, based on some of the recent data we've seen out there, maybe that standard-of-care arm might not even perform as well as we'd assumed based on some other trials that have come out. But we continue to remain very confident in our assumptions on the design.

Okay. Good. We're looking forward to that. Now assuming that, that top line is positive, there's a rolling BLA for AT-GAA that's expected to be completed next year as well. And so what are the key steps to completing that submission once you have data?

Yes. The -- so the first step is the preclinical module, and that's slated to go in by the end of this year, and that's on track. So right now, we're really pulling together the module and writing sections, and so we're in good shape there. From a manufacturing perspective, that's probably the next chapter to go in. Reminder, we announced that we had completed the drug substance PPQ runs and successfully released that product. That was earlier this year. Now we're near complete with the drug product PPQ runs, so drug substances, of course, the bioreactor runs, that's a much longer and potentially more risky process. So it's great that that's behind us. Now we're doing the lyophilization stuff, much more straightforward and quicker to complete, and then we'll release that product. And then we'll complete the analytical data package that go in to support the CMC section, along with stability, and that will go in next year. And then the last piece will be integrated safety and efficacy sections, which, of course, come key off availability of the data. So all of that is well under way. We're in good shape to start this year, as we said, and then, as you said, complete in the first half of next year.

Okay. So in line with that, as you're thinking about commercial prep, obviously, we would also want to know your thoughts about what you think of existing and upcoming competitive landscape. So that there's obviously the current market, the Sanofi [indiscernible]. They have their next-generation ERT, neoGAA, which we've seen their pivotal data for. How do you think that GAA would fit into all that?

Yes. So we really have high confidence that our product AT-GAA will -- can be the standard of care and the dominant product in that space. We know that for 14 years or so, the only treatment option available for people living with Pompe has been the first-generation ERT, Myozyme and Lumizyme. And clearly, an important first treatment for patients. And I would say, despite some of the interesting data that's come out recently, we believe it's having some effect, and that's been well studied in literature. However, as Sanofi has commented so, we also know now that the carbohydrate structures, in particular, the mannose 6-phosphate content that's still critical for targeting an uptake into key tissues, is suboptimal, and that's really what we focused on when we developed AT-GAA. I think some important elements to consider when you think about how really our target product profile. First of all, we designed our study as a superiority study to standard of care, which is Lumizyme, Myozyme. And Jeff just walked through why we're confident that we could hit on that superiority endpoint. And in particular, on what is the gold standard endpoint here, which is 6-minute walk. But we also expect to see positive data across the other endpoints as well. So first and foremost, we're assuming we're going to have a superiority outcome. The second piece is that we enrolled both switch and naive patients in our study and did agreement from the regulators that we would be eligible for a broad label. And so we enrolled about 75% switch, 25% naive in the study. Those data will be combined, but we'll end up with a broad label, assuming the outcome of the study is positive. And that's really important, I think, in the context of the next-generation therapy that Sanofi is developing, which primarily enrolled naive patients. And so -- and also ended up being a noninferiority study. And so if you think about -- if you project forward our Phase II data, if we hit superiority with a broad label, perhaps neoGAA is noninferiority in naive patients and then we know some of the challenges from Lumizyme, I think that sets us up for a really strong target product profile and the potential to really, again, establish AT-GAA as the standard of care for these patients.

Okay. Now as we think about the actual launch for Pompe, you're already a commercial organization. And what are some of the things that you've learned from doing the Galafold launch that you think will help you for Pompe?

Yes. It's fine. As we reflect back, it's such a different scenario now than where we were with the launch of Galafold. So when we launched Galafold, we literally had no commercial people until we filed that program. And in Germany, for example, which was the first approved country, we were hiring the commercial people all the way leading up to launch. So we had nobody on the ground. We also had no patients in Germany, actually. So the first launch country was a totally de novo launch experience. We were building our supply chain and building up the whole organization. So -- and when we -- so we had no patients in Germany, we only had about 75 patients globally on Galafold when we launched, so a relatively small base of patients. If you now look at Pompe and AT-GAA, full commercial organization, as you said, we're present in 30 countries around the world. We have a much larger number of patients on therapy, and we will at the time of launch. So could be right now around 150, could be upwards of 200 with all the extended access and early access programs that we're looking at. And so we have a much larger base to launch from. And the price, which I'll come back to in a moment, it's about double the price point on average for standard of care for Pompe versus what we launched with Galafold. So more patients, more people on the ground with relationships with the key docs and about double the price point on average. You combine that with, again, we hope to be a superiority endpoint, and so we think the value proposition that we're bringing to the space is crystal clear and very compelling. And I will say this. I think the most important lesson that we learned with Galafold, in addition to just kind of getting the organization up and running, was really the importance of broad and fast access. And so remember, our pricing strategy, which is really based on our belief statement that says our products must be fairly priced and broadly accessible, we decided early on we were going to go at parity or modest discount in the Fabry space to enzyme replacement therapy. So the debate wasn't around price. It was just around getting the product approved. And that allowed us to go through the approval process much faster than industry average and have a very clear value proposition, and we haven't failed to get reimbursement in any of the markets that we've moved into. And so if you apply those same lessons learned to AT-GAA with a similar pricing philosophy, I think we are well poised for success, and just starting at such a stronger base than we were in February, and that was a great launch, so we have high hopes for what we could do with Pompe.

Yes. We're looking forward to that. Have you had any discussions with payers? And could you share any feedback about their general views on AT-GAA?

Yes. So we had -- we will do market research with payers and KOLs all the way up until launch. But yes, we have had great interactions with payers so far. And really, we presented the 2 sides of the equation. On the 1 side is the data. So we presented our target product profile, which is assuming superiority and kind of the data -- projecting the data forward from Phase I/II. And they love that endpoint. I mean head to head, both switch and naive on the defined gold-stated end point, superiority, it's like the perfect kind of trial design. So positive feedback there. And then on the pricing side, again, we have made that commitment where we would be parity or modest discount to standard of care. And they love that as well. So of course, you still have to go through negotiations. You never know what's going to happen. But in terms of just presenting kind of what we think we'll see on the data and our historical pricing philosophy, we've had very favorable feedback so far.