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

Great. Okay. Well, thanks, everyone, for joining us. Great pleasure to have Amicus with us. My name is David [ Dyer, ] I'm biotech analyst here at UBS. It's a great pleasure to welcome Jeff Castelli, who is the Chief Development Officer with us. Jeff, welcome.

Thank you, David. It's a pleasure to be here.

Great. [Operator Instructions] So just let us know if you have any questions and ask away. With that out of the way, Jeff, turning to you. Just talking about the Amicus story, right? For people who are less familiar with the story, maybe just give a quick overview of Amicus, what does the company do and what progress they made over the past year?

Yes. Great. Thanks. So Amicus is a rare disease-focused company. We look for first or best-in-class medicines where there's high unmet need. We're very unique in terms of biotech companies in the rare disease space. We actually have 3 programs, each with a $1 billion potential opportunity, and they're at different stages. We have a strong underlying financial strength. We're turning profitable here in the second half of the year in a good cash position. But just top line, Galafold for Fabry disease is our first approved product back in 2016, 2018. We have 10% to 15% growth this year for that product, over $500 million in sales. Lots of diagnostic tailwinds and a long runway there. So we're really excited about Galafold. For our second product, Pombiliti, Opfolda. We're kind of early in the launch there. We were approved in 2023. That product is doing 50% to 65% growth this year, going to pass $100 million in sales. There's a lot of growing body of real-world evidence that we're excited about. And again, we see that as ultimately growing to $1 billion opportunity. We're also excited about a recent transaction we did to get rights to DMX-200 in FSGS. That is a rare kidney disease, currently no approved treatments. We have U.S. rights, that's another potential blockbuster opportunity with a very unique mechanism of action that's in a Phase III trial. And all that on the backdrop I mentioned of finances where we're in the past $600 million revenue this year on our way to $1 billion in 2028. And as I mentioned, turning profitable $260-plus million in cash, and we actually just generated over $30 million in cash in the third quarter. So a lot of exciting dynamics and a lot of -- on a very strong financial backbone.

That's very good. Thanks for that overview. So then on a high level across your products, can you maybe just help us understand some of the key growth drivers for each and discuss your confidence in meeting the guidance?

Yes. So again, going back to Galafold, as I mentioned, really what's driving Galafold growth is increasing patients being diagnosed and put on to treatment. We have about 65% share currently of treated amenable patients. And Galafold is a precision medicine only that is targeted towards a certain type of Fabry disease caused by amenable mutations. In that segment, which is about 35% to 50% of Fabry, we have about 65% share. In the countries where we've been on the market the longest, we see that we can get to 85%, 90% share. So there's a good switch opportunity there for Galafold still. But what's really driving things in the largest markets like the U.S. and in Europe and in Japan more and more is just growth of patients being diagnosed. It still remains a very under diagnosed disease. There's lots of tailwinds in terms of access to gene panels in cardiology and in nephrology. There's newborn screening happening in the U.S. in 8 states that cover 15% of newborns. There's a great opportunity for family cascade testing after you identify an index patient. And then all that on the backdrop of what's really left to diagnose in Fabry is late onset Fabry, and that tends to be highly enriched for amenability to Galafold. So all those tailwinds are really in the amenable part of the Fabry population. So we feel like we're in great second quarter, third quarter, and we see that continued momentum on Galafold for the fourth quarter. Moving on to PomOp. We just came off of the strongest quarter in the third quarter of new patient adds, and that was on the back of Q2, which previously had been the strongest quarter in new adds, and we see that continued momentum going into the fourth quarter. So in the U.S., those new patient adds as we see more patients that have been on Nexviazyme for 2 years, which we really view as one of the key populations in the U.S. That is continuing to grow, we're seeing that acceleration in new adds in the U.S. And then ex U.S., the geographic expansion going quite well. We've added 8 new countries this year on the way to adding 10 total countries. And some of those are pretty interesting. One is the Netherlands, where one of the key academic centers in Europe, there's actually about 100 adult patients, and we won first line to get 70% of those patients, and we're well under the way of transferring those patients over to PomOp. Also have recent approvals in Sweden, where we have first line. In Japan, we just launched a very interesting dynamic there. Nearly every single patient in Japan, as we enter that market has already been on Nexviazyme for 2 years. So it's a very interesting one in terms of built-up patient demand of patients looking for a new alternative. So that will be a great geography, both from an opportunity as well as to learn from. And as I mentioned, we see a really strong runway here going throughout the rest of the year. So very confident in our guidance there as well. And then just we continue to manage expenses and cash, and we feel good from that aspect as well.

Yes. this is really good. And just help us understand what are some of the key factors influencing the low and high end of the guidance?

Yes. Probably the biggest factor there would be just the rate of the new patient adds in the U.S. for PomOp. That is really the one that's probably the hardest to sort of really predict and it's one that has in terms of pricing, the biggest impact. But we feel, as I mentioned, really confident in meeting the guidance. And really, that probably is the biggest dynamic that moves us up or down. But coming off of the strong Q2, Q3, we feel really good about the rest of the year.

Great. Great. Well, let's start with some of the programs here. So first on Galafold. So diagnosis increasing seems to be an important driver, right? So how are you working to increase patient identification and diagnosis at this time?

Yes. So as I mentioned, with the newborn screening, that is seeding a lot of index patients within families that haven't been diagnosed before. So one thing that we're looking to do is to make sure that physicians, families have the resources they need to do that family screening cascade screening. It's a big opportunity. Another one is as more and more patients and mutations have been identified, there's a growing pool of people with what are called variants of unknown significance. These are Fabry mutations that it's not clear whether they may or may not develop symptoms and need treatment. What we're starting to see is more data is available that it does seem like a segment of those patients do need treatment and trying to help physicians understand why, how to find those patients. And when you actually look at that opportunity of some of these common VUSs and even if you just assume 10% to 15% are in need of treatment, that pool of patients is almost as big as the pool of all the other amenable mutation patients combined. So that's another really important initiative for us is to help physicians and patients understand how to figure out whether you need to treat a VUS patient and when you should treat those patients.

Got it. Got it. And then what do you think is sort of the ultimate true size of Fabry patient population in the market?

Yes. So it's amazing to see the change in that market over the years. When we launched back in 2016, it was about 5,000 diagnosed treated patients and 5,000 diagnosed untreated. As you fast forward today, it's now that 5,000 treated is now 12,000 treated and the 5,000 diagnosed untreated is now 6,000 diagnosed untreated. So we've seen tremendous growth, still a big pool of people that have been diagnosed but haven't yet started treatment. When you look at the numbers from newborn screening from at-risk population screening, it suggests there could be 100,000 plus of those patients still. So while it's amazing to see that we've now gotten up to almost 20,000, there's still a long way to go.

Got it. So the bigger opportunity there. So where does Galafold go from here? What are you working on? And what is the cadence of growth we should be expecting?

Yes. So as I mentioned, one focus is on getting the treated amenable from the 65% to the 85% to 90%. We're continuing to add some countries, but those are smaller parts of the opportunity at this point. And it's really just trying to invest in the diagnostics and making sure we can start to find those patients, treat the patients that should be treated, help to justify that. And then we might touch on it, but looking at the runway for Galafold, of course, we are excited where we are with the IP in the U.S. and some of the litigations, and we see a 10-plus year runway here for Galafold. So we're really excited by that.

Got it. Okay. Great. Let's switch now to Pompe launch. So what are the major puts and takes you've seen so far in the launch as you expand globally?

Yes. So adding countries was key for us this year. As I mentioned, we had a target of adding 10 countries. We've already added 8. Some of those have been very great wins for us like the Netherlands and Sweden, where we got first line. So really just trying to continue to see that geographic expansion, continuing to focus on the U.S. and that acceleration of patients that have been on Nexviazyme for 2-plus years. A big focus for what Amicus is investing is continuing to look at the real-world data. We've just started to see our 4-year data from our PROPEL extension that showed those improvements in motor function and muscle strength observed in the first year have been maintained for 4 years. So showing that improvement is possible with PomOp, especially on motor function, seeing some of the real-world data coming from third parties that a great presentation at ICIM by an independent group compared how patients did when they went from Lumizyme to PomOp or Lumizyme to Nexviazyme and that looked like, again, motor function was improved for the patients going to PomOp, which was very different. So we're excited by that emerging data that continues to support what we believe is a great product offering with Pomop and really now just looking towards continuing geographic expansion, continuing to execute in the U.S. And from an IP perspective, that's -- we're early in the launch, and we have a long runway there. So really just an opportunity to keep executing.

Yes. On that front, what do you think are the sort of the relative contribution of ex U.S. markets to your estimation of the PomOp global opportunity?

Yes. So ex U.S. currently is in the 55% to 60% range, I believe. Probably that will get a little bit more slanted towards the U.S. as we go. But the U.S. in terms of patient numbers and pricing will always be the dominant country for PomOp. But ex U.S. is a really important driver of growth for us even with the lower price just in terms of volume of patients and new countries that we're adding. I also think as you look at some of those markets, it does give you a good sense of where we think we can go. So in the U.K., that's the country we've been on the market the longest. We actually have been on for 3-plus years in the U.K., given some of the expanded access programs. And we're excited to see we've been able to get to market shares of 40% plus in the U.K. already. And that gives us sort of a feel for where we hope to end up with some of the other countries like the U.S. and others as we get there over time.

Tell us more about the pricing headwinds you're seeing so far. Is this from...

Yes. So in terms of pricing headwinds for the U.S., we haven't really seen anything. I mean, with Fabry and Pompe, we have products that there's already existing products, and we have a pricing philosophy where we price for access and at a discount to other products or a slight discount to other products. So we really focus on that access, and that has worked out really well for us. And we commit to not raising prices more than CPI. So I think that pricing approach has served us really well in the U.S. and internationally. While there are a lot of pricing pressures, I would say, in the rare disease space, at least we've been able to keep prices at a pretty good place ex-U.S., haven't seen significant erosion. And obviously, Pomop, we're still sort of in that launch phase, but we're starting to see is we have that mix of European countries high and low, we're starting to see that, that price is sort of stabilizing.

Got you. Okay. Great. And what kind of dynamics have you been seeing for PomOp switches from other therapies?

So really from early launch, we've seen that PomOp in a given country really sort of draws proportionally from the underlying patient population. So for example, in the U.S. now where 70% of the patients on the Sanofi product are on Nexviazyme and the others are on Lumizyme, we're primarily seeing Nexviazyme switches in the U.S. In other countries where it's more of a Lumizyme population, we're seeing more Lumizyme patients. I will add that outside of the U.S., where we actually have a broader label in terms of naive patients being included. We are -- actually saw a doubling of naive patients this year versus last year, and we continue to win a really fair share of those naive patients, which is an exciting opportunity for us as well.

Got it. And then what should we expect over the rest of 2025 and into 2026 for the cadence of pump up revenues from here?

Yes. I mean, for the rest of the year, with the 2 months left, as I mentioned, we feel really good about in terms of where we are from our guidance based on the momentum from Q2 to Q3 that we see continued to Q4. So really no surprises. As we go into next year, we haven't provided guidance yet for next year, but we feel that really getting as many patients on drug as possible this year obviously sets us up for a great 2026. And a lot of these countries that we've recently launched into and all the patients we've added, while they haven't necessarily shown a big impact this year, really set us up for that growth next year.

Got it. Okay. Great. And then Jeff, you mentioned about the IP. If could just tell more about the IP for Galafold? And then what are some of the recent settlements for IP in Palma?

Yes. So this is an area where we get a fair amount of questions. So as I mentioned, with Galafold, we have a long runway. Our patent protection goes into the 2040s. We have over 40 Orange Book listed patents. We did have 3 generic filers last year and the filers. It was Teva, Lupin and Aurobindo. We did settle last year with Teva for a January 2037 date. Lupin took a stay, which means that they're bound to the outcome of the trial. In Aurobindo, we actually went all the way to trial. We just had that trial in early September. And I think the way we've characterized that is we felt very confident going into the trial, and we feel more confident coming out of the trial. We think we're in a great position. That being said, next steps would be kind of there's the post-trial briefings that go back and forth, and that will resolve in mid-December. And then just based on other trials, we would expect it would be about a 4- or 5-month sort of time for the judge to review things. So we've guided towards second half next year for when we'll see the outcome of the trial.

Got it. Okay. Great. And then what can you say about the impact of MFN and potential tariffs on your commercial business?

Yes. Well, I mean, starting with tariffs. So depending where they end up, I guess the good news for us is for 2025, really a negligible impact. So Galafold to start has a pretty low cost of goods overall. So not a whole big impact from tariffs wherever they end up, and we manufacture Galafold in Europe. Pompe would be a bigger impact of tariffs. This year, we've already expensed most of our inventory, so really doesn't get impacted by tariffs. Next year probably would be the year where there's the biggest impact. We're well underway of moving manufacturing from WuXi China to WuXi Ireland. We do expect currently, net-net, there'll be lower tariffs in Ireland, and that was part of the reason we had initiated that move as well as just geopolitical security. So that transfer is underway. We have approval in Europe. We're looking for approval from FDA early next year. And throughout next year, we'll start to transition supply from China to Ireland. And then by 2027, it will be primarily Ireland. So there would be some impact on tariffs next year, mainly driven by Pombiliti, but very manageable within sort of the numbers in terms of financial metrics that we have. So longer term, we see that as a pretty moderate and pretty mitigated impact, frankly. MFN, a little harder to get a read on, I would say. We do have our former CEO, John Crowley, is involved as the Chair of Bio, CEO of Bio. Our CEO, Brad Campbell, is very involved in a lot of the ongoings with the agency and with the government. So with the administration, our current view is that if something does happen out of MFN that there might be a rare disease carve-out like we see in other sort of proposals and policies. So if that's the case, there could be very muted impacts of MFN on Galafold or PomOp. If there is an impact, most likely, it would be on the Medicaid population, and that currently is about 5% of Amicus sales in the Medicaid population. So there would be some impact to that percentage of sales. But again, fairly manageable if that were to happen. But again, we think a carve-out for rare is probably more likely.

Got it. And then let's talk about the DMX-200. Maybe just a high-level perspective, Jeff, can you talk about why to bring DMX-200 to bring it in and why FSGS?

Yes. So we're really excited at the collaboration we have now with Dimerix and having U.S. rights to DMX-200. I actually just got back from ASN and came here directly. And there's just a lot of buzz in the rare kidney space with some of the recent launches in IgAN and other diseases as well as I think what everyone views as a much clearer path towards approvals for these drugs with the FDA being open to proteinuria as a primary endpoint for approval. So with Dimerix, it was an opportunity for us to get into rare kidney. It is adjacent to Fabry that is a nephrologist is part of the treaters in Fabry. So it fit from a kind of call point perspective. There's a huge unmet need, currently no approved treatments, much more clarity around FDA pathway, as I mentioned. This is a very unique mechanism of action with DMX-200. It targets the monocyte-driven macrophage damage that happens in damaged tissues like the kidney, in diseases like FSGS. So we are very excited by the mechanism, by the unmet need. The U.S. alone is 40,000-plus patients. We see that as potentially even with modest market shares of blockbuster potential product that addresses a significant unmet need. And all that on a backdrop that we were able to fit it in financially to our strategy, which is to take the cash that we're now generating from our core businesses and invest that into value-generating new programs or opportunities. And this was one where for $30 million upfront with no additional payments until positive Phase III data was something we could really fund ourselves, and we think really provides access to a really exciting new medicine in an area of high unmet need that has a lot of opportunity to benefit all the stakeholders.

You mentioned about 3,000 patients. Could you just tell us -- give us a little more detail around the market for FSGS?

Yes. So FSGS, it's 40,000 estimated patients. It's a rare kidney disease, multiple underlying causes. There's primary FSGS that seems to be driven by some sort of circulating factor that damages the kidney -- there's APOL1 FSGS that kind of puts the kidney at more susceptible risk of damage. Ultimately, all FSGS is kind of caused by damage to podocytes or the kidney. And then that damage results in inflammation. It results in other parts of the kidney having to work harder and having more hemodynamic stress that leads to more damage, more inflammation, more stress. So it's this kind of underlying pathological loop that these patients get stuck in. And what we're really looking to address with DMX-200. Is it actually to break that monocyte macrophage-driven inflammation in those patients. So there is another product that is from Travere, FILSPARI, which is approved in IgAN. They have a PDUFA date in mid-January, which would be an approval based off of their data set, which is proteinuria supported by GFR, very aligned with what where we are with FDA in terms of what we've heard and our plans are for our program. So we view FSGS space ultimately has a lot of different mechanisms causing the disease. And I think down the line, you'll see multiple agents approved and used in different types of patients or in different combinations. But really exciting to have a chance to address that monocyte macrophage-driven inflammation that really is a key part of many diseases and not really addressed well by current therapies.

So with Travere being a little bit ahead of you, how are you thinking about your commercial strategy or your development strategy to competitive to them?

Yes. And we really view it as less competitive and more synergistic with Travere in the space. As I mentioned, there's a lot of different mechanisms of disease. So I think you'll see that with certain agents, some patients respond very well, but others don't. And you might see that those patients then respond better to a different therapy. So I think just getting a first product approved, starting to get the market to better follow their patients to sort of pave the way. And in some cases, with Galafold and PomOp, kind of coming in with another agent has actually been a great market entry for us. And sometimes it's not a bad place to be to come into that market second. So that being said, as I think there'll be multiple agents down the line approved with FSGS. And we don't - we view all the players in that space is actually kind of complementary. And none of them are really addressing that monocyte macrophage aspect that DMX-200 does.

So it's actually addressing the actual underlying disease for...

One of the key drivers of the underlying disease, I would say, whatever that original injury, it kind of leads to, I think you'll see a place for corticosteroids are used sort of first line, some patients respond, but most don't. I think you see ARBs are used to help manage the blood pressure and kind of lower some of the pressure and that helps some. I think you'll see drugs like FILSPARI, where they add an endothelin inhibition being helpful in a certain segment of patients. There's complement inhibitors that could be helpful in some patients. And then that macrophage monocyte inflammation is going to be helpful in those patients where that's a key issue, which we think is a significant fraction of patients, not all of them, but enough where we think it will add a lot of benefit and certainly a lot of opportunity commercially as well.

Do you think there's a -- do you think actually target the more severe population? Is there like a difference in terms of severity, population that you're going to target immediately?

Yes. So from a Phase III population, we're going after patients that are either primary or genetic FSGS that despite treatment corticosteroids, ARBs still have high proteinuria above 1.5 gram per gram. So these are patients most at need, frankly. Unfortunately, that is a significant amount of the FSGS patients today. And those are really the ones that we're targeting with DMX-200. We think those patients, one of the reasons that many of them have not been able to have reductions in proteinuria with current treatments is that the monocyte macrophage inflammation is a big contributor. So it's enriched for people, we think that will respond to DMX-200. But in a way, you are going after the more severe patients who frankly have the most need. If the patient is managed well with the standard of care, then they probably wouldn't be looking at a new treatment anyway. But as I said, unfortunately, right now in FSGS, it is a lot of patients who still have hyperproteinuria.

And how -- think about the development plan for DMX-200. Can you just help us understand a little more around thoughts around the clinical trial design, the time line for potential readout and then commercialization?

Yes, great question. So we're really excited. I think we recently just announced that we're past 90% towards enrollment of the ACTION3 study. We're on track to close enrollment out around the end of the year. There is a short period of ARB stabilization before they're randomized to DMX-200 or placebo. So early next year, we'd see the last patient randomized. Then we're about -- it's a 2-year trial, so top line data 2 years from then. So great progress on enrollment. Dimerix did just recently announce that we also completed analysis leveraging the PARASOL group and data where we match towards the ACTION3 baseline parameters. And that data suggested similar to what's been seen from PARASOL data with FILSPARI and FSGS more broadly, that changes in proteinuria at 1 and 2 years were very predictive of progression to end-stage renal disease. So that data set is very helpful for us as we go in right now and we're finalizing the 2-year endpoints with FDA as well as the plans to do a sample size reestimation on the key endpoints. And then our plan is to take all that knowledge once it's -- once protocol is finalized, SRE is conducted, we see the outcome of the PDUFA in January for FILSPARI, we'd like to then go in and talk to FDA. Is there an opportunity based on the data to potentially do an accelerated approval based on 1-year data. So we certainly will have that conversation. We have been very careful to guide to say our base case is 2 years. Hopefully, the FDA will be approving the first treatment in FSGS on 2-year data coming up here in January. But that being said, the data that we've seen from PARASOL does show that 1-year proteinuria is very predictive of outcomes. So we certainly want to have that conversation.

Got it. That's helpful. Any changes in the FDA in terms of their view on the endpoints, any tightening around the regulatory side of things?

No. So far, FDA has been responding on time, which is good to see. Even during the shutdown so far, they've been very responsive. And so far, we haven't seen any change in sort of what they've said in terms of how they've acted. Obviously, it'd be very informative to see what happens here with Travere coming up in January. But other than that, so far, we've seen FDA is conducting business on time, and we haven't seen any surprises.

That's great to hear. Great. Okay. Then last question, just what are the major catalysts coming up for fold over the next 12 to 18 months that we should watch for?

Yes. So I mean, starting on Galafold, just continuing on adding patients and the revenue growth driven by that diagnosis. I think big catalyst will be on the Galafold IP as we see resolution here in the first half next year. I think that is an important one to point out for Galafold. For PomOp, again, it's looking at how that fourth quarter looks, building off of a very positive Q2 and Q3. We expect to continue to present on real-world evidence on PomOp. We're excited about some of the upcoming abstracts at the World meeting coming up in February. And for PomOp, we'll also keep an eye on the pediatric programs. We do expect to have our first label expansion middle of next year for the adolescent LOPD group. So I think that is another catalyst for us. Then DMX-200, obviously, finishing enrollment when we announced that and then also an update in the first half about potential accelerated approval conversations. And then I think just underlying that, continuing to execute on the financials.

Excellent. Thank you, Jeff. I think with that, we can wrap up the fireside chat. Thanks, Jeff, for joining us.

Thank you, David. It's a pleasure.

Great. Thank you, everyone.