Arcutis Biotherapeutics, Inc. ($ARQT)

All right. Good afternoon. Let's kick up the next session. I am pleased to be hosting Arcutis Biotherapeutics for the next session. And with me is Frank and Latha, CEO and CFO of the company. We have a lot to go through today, very exciting quarter from what we saw last time and then looking forward to a lot going on this year. So before we kick it off with the questions, I'm going to turn it to you guys for opening remarks.

Sure. Yes. I mean, look, I think that everything is going very well from our perspective on at Arcutis. ZORYVE continues to grow very strongly. We had another very strong quarter last quarter. We think we're still in the very early stages of growth of this product. And we reiterated and we think that the product ultimately will generate probably $2.5 billion to $3 billion in peak sales, which is not a stretch given the size of this market and the product profile that we have. We've also achieved cash flow positive, and that has put us in a position where we can continue to invest in the growth of ZORYVE for its currently approved indications, but also to start to reinvest back into research and development, both looking at new indications for ZORYVE and we have a couple that we're studying already that I think you wanted to talk about today, but also we have a biologic that we've now advanced in the clinic, and we've got the resources to advance that program as well. So we're a fairly unusual setup in that we're a self-sustaining biotechnology company that's not burning cash, right? And I think that we had laid out a strategy late last year to the investment community. I think the team has done an outstanding job of executing against that strategy and delivering.

Right. Fantastic. So why don't we talk about a little bit about catalysts for the next 12 months. There are some indications in development for that. Maybe just walk us through the -- some of the key catalysts in your perspective for...

Sure. Yes. So I think the first nearest catalyst actually is we're expecting approval from the FDA for ZORYVE for the treatment of psoriasis in 2- to 5-year-olds at the end of this month. June 29 is the PDUFA date. We've also filed with the FDA for the approval of the treatment of atopic dermatitis in 3 to 24 months old. We have not received a PDUFA yet for a PDUFA date yet from the FDA, but would expect that probably early next year for that approval. We also are running a Phase II trial right now for ZORYVE in the treatment of vitiligo, and we've said that we expect to read that results out from that study at the end of this year. And then we're running 2 Phase II trials for the use of ZORYVE to treat HS, and we expect to read out those studies in the early part of next year. So in the next months, we've got a number of, I think, important catalysts coming up.

Fantastic. So last quarter, sales were up 65% year-over-year, but down 17% quarter-over-quarter. And you guys mentioned that it was impacted by those typical seasonal effects and also severe weather. So while the quarter -- this quarter is not affected by weather, but there's a lot of macro uncertainties like inflation, gas price. How is the current inflationary environment affecting patients getting access to medication. And will we see an effect to sales this quarter and going forward?

Yes. So I mean I think every business has to deal with the macro forces going on in the country right now. I think it's not the most benign business environment. But I think specifically to Arcutis, we don't expect it to be a particularly acute effect. If you think about a commercial patient, we buy -- patients co-pay down to 0 if your insurance company covers ZORYVE; $35, if your insurance company doesn't cover ZORYVE that isn't affected by inflation, right? So for commercial patients, ZORYVE itself isn't really a major impediment for them. For Medicaid patients, they're paying $10, $15 maybe per prescription. And so again, we don't see that being a major impact. And then in the case of Medicare, that's not a major source of business for us. We're starting to pick up Medicare. So we think over time, that's probably going to grow. And in the case of Medicare, we've got this strain system where patients have this total annual co-pay deductibles that they have to work their way through. But that's again, fixed. So I don't think inflation per se is going to impact us nearly as much as maybe some other products.

I see. Okay. Got it. So given that the weather -- I think you guys mentioned the severe weather affected patients access to medication last quarter, does it mean that the GTN for second quarter will be worse unusually because a lot of patients who were not having access last quarter are now coming in this quarter, but they haven't really met their deductible because of the access.

It's an interesting hypothesis. So let's break this down in 2 ways. With regard to the first quarter, and this was not unique to ZORYVE, right? But there are many, many products that saw the impact of the extreme weather. And I think one of the ways you can really validate that it was the weather is that it was very regional as well, right? The West Coast was not affected, volume was not affected. The East Coast and especially the Southeast was very affected. And then we saw a rebound in March and then on into Q2 in demand. So that occurred for a lot of products. It's probably a little bit exacerbated in dermatology because there are very long waiting list to see a dermatologist. And so -- for example, specialties -- in terms of the gross to net, I understand your question. What I would say is what we saw in the first quarter was that we were actually spending less on the co-pay card than we normally do. So that would tend to mitigate against that carrying on into Q2. I think we're actually in a better position now in gross to nets than we were last year than we expected. Latha, do you have any...

No, I was going to add something similar. So yes, I think also some of that effect -- you would have seen it prolong in March when we didn't -- we saw the demand pick up. So I don't think there's anything that signals that there's an undue co-pay burn in Q2, and we've seen strong volume growth in the last quarter to date of Q2 to date versus last Q1. So that's also another signal that we don't think there's any impact from what you're describing. It's possible, but it wasn't a severe that we think that there is that impact to copay.

We think we'll carry this GTN favorability through the year.

I see. Okay. Got it. That that's encouraging to hear. Can you guys remind us sort of these in-house efforts that are ongoing in terms of supporting the primary care in the pediatric. What are you doing that [indiscernible] wasn't doing or doing well? And then what's the timing of that launch for that sales team again? And then what's that initial scope and the size of that effort?

Sure. So let me start by talking about [indiscernible]. I don't think that people should think of it as [indiscernible] was not doing it well. I think the challenge for coal was they had an existing sales force. It's about 200 reps and they had a product and they lost exclusivity on that product. So they had this existing sales force. I needed the sales force, so we struck this deal with them. Their sales force was probably just too big, right? And so it was not an economically viable business for them long term. And that was really why we agreed to separate. We are taking a very different approach. We're starting off very small. We've communicated that we're starting out with 20 sales reps. We're putting them in major metropolitan areas and really focusing them on high-volume primary care docs and pediatricians. We will probably grow that footprint over time. I don't know how big it's going to be. It's really going to depend on the success that we've had. But what we're doing with that 20 is really piloting the primary care and pediatric market and seeing what's the best way to market in that segment as opposed to dermatology. And then we'll start to scale it once we figure all of that out.

I see. And so what is that difference in terms of promotion to the PCPs and the pediatrics compared to -- is there any notable difference set that how you guys engage with them?

Not how we engage with them, but I think first and foremost, dermatologists, the most common disease as dermatologists see are acne, psoriasis [indiscernible]. Probably see 60 -- 50, 60 patients a day, maybe half of those patients have 1 of the diseases that we treat, right? So there's a big opportunity there. And it's a big part of their practice. You've got a primary care doctor pediatrician. They're treating everything from asthma to [indiscernible]. There's a very small volume of their patients that have psoriasis, AD or [indiscernible] so it's not front and center for them. And they're trying to keep track of all these other diseases, right? I used to work in primary care. The biggest challenge in primary care, frankly, is getting a primary care doctor's attention. And we expect it to be a longer selling cycle, access can be a little more challenging. The calls tend to be a little shorter and this is not their primary business treating skin diseases, right, versus dermatologist. I think the other difference is that dermatologists are very used to, in fact, I would say, are committed to working with specialty pharmacies. The primary care docs aren't nearly as familiar with that. We think that's going to be an important part of our success in primary care is getting them to use the specialty pharmacies where they get the white glove treatment to make sure that the patients are actually getting their prescriptions and the insurance is processing it correctly.

I see. Okay. Got it. Can you give us an update on the Medicare business? I know you guys are -- you guys have that access that you guys mentioned where you -- about what 1/3 of Medicare patients now?

Yes, that's right. We picked up 2 of the big plans. We've got about 1/3 of Medicare lives now have access to ZORYVE. And unlike the commercial plans and Medicaid, Medicare has this annual deductible. It's $2,100 now. Patients have to burn through their $2,100, and then everything is free after that. So the first part of the year is a little more challenging especially for a new drug. But I think we'll see a pickup in Medicare as the year progresses. I think we're also hoping that we get additional Medicare coverage in 2027, picking up some of the other plants. The Medicare formulas typically only change once a year in January. But we do anticipate that over time, Medicare will be an important driver of growth for ZORYVE.

Right. And then you guys have covered by a nonpreferred access position. Is there a possibility to move to preferred? And how would that change? If you get from nonpreferred to prefer, how would that move the needle?

The change between [indiscernible] really only affects the patient's co-pay. I think it's highly unlikely that they would produce in a preferred position. Being a branded on the formulary period is a big deal. There are no other branded topicals on the Medicare formularies. So we were very happy to get nonpreferred quite frankly. And I think for us to rebate our way down to being preferred, we probably have to get down close to a generic price, and that's just not going to be economically feasible.

I see. Okay. Okay. That makes sense. And when should we hear another update on these Medicare patients regarding the the other 2/3 of the coverage?

As I said, typically, they changed the formularies in January. They have to get reviewed by CMS. So there's a whole process around it for Medicare that doesn't exist for the other plans. So I would hope that we would be able to -- in January -- on the Q4 call in February, we'd be able to announce some additional wins.

I see. Okay. So in the fourth quarter last year, you guys highlighted the label expansion for ZORYVE as part of that 3 pillars of growth. And Vertigo NHS were identified as sort of the top 2 indication to begin that process based on, I think, 40-plus case studies. [indiscernible], which is also a [indiscernible] inhibitor, have shown mixed resells in these 2 indications and has not advanced to Phase III development. Why do you have conviction that ZORYVE could work given that similar with...

Well, a similar target, very different drug. So [indiscernible], the active ingredient in ZORYVE is 100 to 300x more potent as a PD4 inhibitor than [indiscernible] is. And to give quantify that people typically take 60 milligrams a day of [indiscernible]. When you take reform last orally for COPD, you take 1/2 of 1 milligram. So 120th as much drug as you take a [indiscernible], that speaks the potency. In addition to that, we're delivering [indiscernible] topically with ZORYVE. We get very, very high localized concentrations of ZORYVE the skin where you apply it. and 50 to 100x more in the skin than you're seeing in the rest of the body. And so we get a very profound local effect on PDE4 inhibition that you just can't achieve with [indiscernible] that matter, right? Because you would have intolerable side effects diarrhea, vomiting, right? I think that's really the difference. But the data is going to be the data. We'll see what we see. We're certainly very encouraged by the case reports we've seen in HS and Vitiligo. I think we've also seen there is good evidence that PD4 plays a role directly in the Molina site, which would tend to point towards efficacy in Vitiligo as well. And then in the case of HS, I think people really don't appreciate the impact of itch and pain in HS as a disease and the high score that everyone looks at doesn't actually look at [indiscernible] pain, but it's very common in those patients. And again, PDE-4 works in the neurons and so we're probably having a direct effect on the itch and the pain as well. And you saw that in the case reports that we were clearing itch and pain.

Interesting. And why do you guys choose the [ 0.3% ] form. Why not go a little higher, higher concentration or test multiple doses?

At 0.3, it gets really hard to formulate reformat typically, right? So we're kind of up -- that's the maximum. Going with a lower strength we didn't see a need. The really -- the only reason why we have a lower strength for atopic dermatitis is that tends to be very high body surface area. A lot of the patients are kids, and there is a skin barrier defect. And so drug gets in more easily in atopic dermatitis skin than other normal skin or psoriatic skin. You don't have any of those issues in HS or vitiligo. The skin is normal. It's small body surface areas, and it's not predominantly kids. So there really wasn't any reason to use the lower strengths. And we know that 0.3 is very, very well tolerated and safe.

I see. Okay. What's that -- what do these trials looking like in terms of the size? When should we see the data maybe like what are the endpoints that you guys are looking at?

Sure. So they're all around 10, 20 patients. They are small proof-of-concept studies. We don't have to look at safety, tolerability were answer on that one. And we've said that we expect to read out the vitiligo trial by the end of this year and that we should read out the HS trials early part of next year. And then in vitiligo we're just looking at improvement in pigmentation. And in the HS trials, we're looking at abscesses and modules.

I see, okay. So how do you define success for these 2 indications? Like what do you have to see for you to...

A clear sign of efficacy. There's no particular threshold we're looking for particular high-score or something like that.

So with that as sort of like a control arm, I mean, these DCs like HS is now for like this [indiscernible] period where...

Right, but not in very short periods of time. So -- and these are fairly short trials. And in the case reports, the efficacy was very rapid. I think that mitigates against some of the natural waxing and waning that you see with the disease. It's not like atopic dermatitis where you wake up in the morning, you're clear in the afternoon, you've got an [indiscernible] same with vitiligo, lesions don't just suddenly appear or disappear.

I see. And how long are these trials running for?

Let's see, the vitiligo trial we're running out to 26 weeks. I believe HS is 16.

26 weeks for vitiligo and then 16 for HS. I see. Okay. Okay. Got it. Okay. Let's move on to the other -- you have another asset in development the ARQ-234. So this is a CD200 is a checkpoint inhibitor?

It's a checkpoint agonist, the opposite of a checkpoint...

Right, right. Okay. So can you tell us what drives the interest of pursuing this as a target for AD?

Sure. I think many of these diseases, inflammatory skin diseases are driven by overactive immune systems, right? That certainly is the case in atopic dermatitis. Historically, we have approached managing these diseases by blocking signaling pathways, various cytokines, IL-4, IL-13 in the case of atopic dermatitis, IL-31; psoriasis we're going after 17, 23, TNF-alpha. The checkpoint agonists are different in that you're actually you're actively affecting the immune cells themselves, right, by agonizing these immune checkpoints, you're taking an activated immune cell and you're putting it back in its inactivated state, which will consequently probably downstream also affect all the inflammatory [indiscernible], but you're upstream of that process. I think people can think of it as the opposite of KEYTRUDA or OPDIVO, right? If you inhibit the checkpoint -- immune checkpoints that tends to rev up the immune system, you agonize the checkpoints, it down-regulates? So it's a different pathway. We are excited about this because there's been some very compelling biologic proof of concept with another molecule against this target. We think there's clear unmet needs for new therapies in atopic dermatitis and potentially other therapeutic indications as well. And the asset that we acquired when we bought [indiscernible], we felt was the best-in-class and for particular target.

I see. SP1 And what is that rationale? I mean, after looking Lilly has something similar, a CD200 agonists as well -- an antibody. And then they discontinue it. So any redo from that? Any concern we do? And how do you think 234 compared to...

Yes, I don't really think that they're -- based on what we know today, we don't really see any read through other than we don't think they had a safety issue with their trials, right? We probably would have heard about it from the FDA if there was a particular safety signal of interest. I've been in big pharma, a good bit of my career, they deprioritize programs all the time. I don't particularly put a lot of weight into the fact that the deprioritized it. They published the results from the study. I think the study results look very good.

I see. Okay. And how is that Phase you get a Phase I study going for AD, how is that enrolling? And when should we expect to see there?

So we're in the middle of the SAD portion of the trial, right? Each cohort enrolls very quickly, but it's very small and you got to wait and then you start the next cohort is a very traditional sad. And then we'll move on to the MAD portion as well. I'm actually hoping this takes a long time because that means I'm going all the way through a bunch of dose cohorts and get a very high dose. We don't have a time line at this point because it will all depend on what the maximum tolerated dose is.

I see. Okay. Now let's move on to the franchise indication for ZORYVE. So now you -- ZORYVE spans across a psoriasis, atopic dermatitis, the more dermatitis across multiple formulations. So there's obviously no safety concerns for [indiscernible] steroids we know that people talk about it all the time. It's very well perceived that have safety issues. And ZORYVE is clean, easier to use and you don't have the safety baggage. Do you see there's a realistic chance to remove some of these step-edits that you have to go to corticosteroid in the future? I mean how do you get there?

So first of all, I don't think that the -- in the commercial side of the business, we're pretty much a single step across the board through a topical steroid. In Medicaid, about half of patients, it's a single step through a topical steroid. So that's the majority of patients in a single step. That is not a big barrier because all these patients have already been on a topical steroids so they've already been step printing, right? I don't lose a lot of sleep over it. I think we may see some improvements in that formulary position. For example, California Medicaid, there is no step for ZORYVE, it's first-line therapy. There are some small commercial plans that have moved to no step for ZORYVE. I think as insurance companies realize that ZORYVE could prevent or delay patients moving on to expensive systemic therapies, they may start to prefer ZORYVE more and make it easier to get ZORYVE. But again, I really don't think that the step edit is a major obstacle. A year, 1.5 years ago, when we would talk to dermatologists, we get pushback like I know steroids have issues, but I know how to manage it. It's fine. We don't get that anymore, right? I think there's a growing sentiment in the dermatology community that it's time to move away from topical steroids. There's always going to be a role for topical steroids. But that's an acute treatment and these are chronic diseases, and that's a mismatch, right? And I would point to, in particular, earlier this year, the American Academy of Dermatology came out with new pediatric AD guidelines, and they stated right in the guidelines that dermatologists should prefer [indiscernible] over steroids because of long-term safety issues. So now even the AAD has come out with a firm stance saying, [indiscernible] are the way to go. I think it's just a matter of slow change in -- and we're seeing that every month, every quarter we're seeing a growing share of the business going to the nonsteroidals. And with 50% market share, we're the main beneficiary of that.

Point Right. Sure. Sure. Absolutely. And then so when you look at the current use pattern for patients who are new to treatment they get on [indiscernible]. Do you see there's a shortening of the time that people get on the cortical [indiscernible] of before they switch to ZORYVE. Is there a change in that?

90%, 95% of patients are not new onset. So they've already been on something. So they're coming in the office for a steroid refill or some follow-up visit, they've already been ad on a steroid. And most insurance companies also it's -- you have to have been on a steroid in the last 180 or 130 or 365 days. It's not like you have to start the steroid and then wait for weeks and then move on. So it's rare that a patient is coming in completely treatment naive and the doctor saying, oh, I want to use -- but if that's what they need to do. It depends on the steroid. But for example, if the patient's plaque psoriasis and they need [ clobetasol, halobetasol, ] those drugs are really only safe for about 4 weeks, and then you need to stop the treatment for safety reasons. And so then the patient can go to ZORYVE.

I see. And a lot of time when I look at these conditions because there's that whole wax and wane component to it, where the condition would just go away for some time come back flare up and come back again. So in that in dose period where the disease sort of like calms down and then it flares up again, do they for -- do they jump back to another steroid and then before they can get on the ZORYVE, like how does that work? Or do they -- because they already on ZORYVE and then let's say they stop, the conditions they feel better then in the net flare up, can they go straight to ZORYVE? Or do they go back to the steroid first before ZORYVE?

So first, let's talk about the waxing and waning. -- psoriasis is not a terribly waxing and waning disease -- it does tend to get better in the summertime especially -- and then it will predictably get worse again in the fall and the winter. [indiscernible] is also fairly chronic in nature. AD is much more changeable. You can be fine in the morning and by lunchtime, you can be in a flare. So regardless across those diseases, if the patient's disease clears because it's spring or summer or the patient has been using the drug and they get better and they get clear, they typically will stop treating at that point. When the disease returns, they probably have ZORYVE in the cabinet already. They don't go to the doctor, they just start using this ZORYVE, right? And there's no issues with stopping and starting with ZORYVE. In atopic dermatitis specifically because it can flare so quickly. There is a move in dermatology towards preventative treatment, treating continuously to prevent the next flare. And in our long-term studies with ZORYVE in atopic dermatitis, we showed that, that was a very effective strategy. And patients who got to clear went to twice weekly dosing instead of daily dosing. And in adults, they went -- they were able to go 10 months without a flare. And in children, they went 8 months without a flare. And that's quite a long time with just twice weekly dosing. If they did flare again, they could switch right back to once daily dosing without any problem. And that treatment paradigm of proactive management is something that atopic dermatitis experts are really encouraging their colleagues to move towards. But to answer your question, too, if you've had a ZORYVE script and you need to refill it 6 months later, you don't have to go through a steroid or you just refill and continue on.

I see. Okay. Okay. That makes a lot of sense. So [indiscernible], this is 1 indication that a lot of investors are very excited about. It's always been undertreated and under diagnose or treat it intermittently, how has Soresort of changed that pattern of use in this population and the recognition of the treatment?

Yes. So first of all, and I remember talking with investors before the approval and you guys are missing it. This is really, really big. This is a big indication. People talking about -- I think I was proved right, right? It's a very prevalent condition. It's at least as common as seb derm. There are some estimates that -- sorry, excuse me, yes as many as 1 -- which would be a gigantic market, right? [indiscernible] been that the existing treatments were not terribly effective, right, or they weren't, say, for long-term use or a combination of the 2. And so when a dermatogrist having to treat [indiscernible] dermatitis, it took a lot of time and it wasn't terribly satisfying. I remember prior to our launch, it was towards the [indiscernible], and we were talking with some dermatologists and they said, I haven't seen some of these patients for 2 years and -- they come in and say, "What do you have new for my subderm and the answer is nothing, right? Because it's been 20 years since anyone come out with a new drug. What really I think changed with ZORYVE is several things. One is profound efficacy, right? We had an 80% response rate at 8 weeks with ZORYVE. 50% of patients were completely clear, no sign of any disease at 8 weeks. We had a very rapid onset of itch, which is 1 of the key symptoms of seb derm. At 48 hours, we separated on itch. It's a once-a-day formulation that's easy to use in your hair. You don't have to wash it out. You don't have to take a shower, which you do with the shampoo treatments. And it's safe to use chronically, right? There's never been a drug like that. So it makes it really easy for the doctor to treat their seb derm patients. It's like a 30-second conversation. Hey, here's your ZORYVE script, use it once a day, I'll see in 6 months versus this complicated regimen and it works for patients and it's safe. And so I think that, that's shifted dermatologists' willingness to treat [indiscernible] dermatitis, right? Because now it's easy for them to treat these patients and the patients are happy.

I see. Is that a population? I mean when I look at that, right, the [indiscernible] makes a lot of sense for these patients. there's -- I don't think there's a form like corticosteroid form.

There are cotocrosteroid foams in existence, [indiscernible], gosh, I'm trying to think with some of the other brands out there. they're very, very expensive. They're very difficult to get. So you don't see much use at all of the steroid foams. Ironically more expensive than ZORYVE, they're generic, right? But also you have all the safety issues of steroids.

Sure. Sure. Right. So I mean that's 1 setting where we just why ZORYVE is at the top right?

I mean -- that's right. I think it's rapidly becoming standard of care in SebDerm -- it's also -- Zero is really unique in the scalp psoriasis space -- just like [indiscernible] really aren't any options to treat scope psoriasis -- and [indiscernible] is a form of crisis that it's a very prevalent and b, it doesn't respond well to biologic neurons. So we think that's a really important continued growth opportunity for us in ZORYVE as well.

I see. That makes a lot of sense. So when you look across all these different settings, what do you think are the largest growth driver across different questions -- the largest growth driver is conversion from topical steroids, right?

Sitting here today, there are 25 million prescriptions written a year for 1 of these 3 indications. 16 million of those were topical steroids last year and $1 million were branded [indiscernible]. So as that market converts over -- the opportunity for us to grow fivefold is really not that much of a stretch.

Yes, I see. Okay. And then for atopic dermatitis, you guys have a couple of new approvals in that area now you have from adults to children to infants. How quickly are these indications added to the formularies? Or in general, when you guys have these moves how quickly do they get added?

Our contracts with the insurance companies generally are for the ZORYVE portfolio so it's relatively quick. It can take a couple of months for us to get a new indication, particularly if it's a new SKU. If it's an existing SKU, it can be a little bit faster, but it does take the insurance company sometime the SKU has to show up in the compendium. You've got to get -- they've got to update their computer systems. I would say probably 2 months is probably a reasonable time frame, maybe it's a little bit shorter in some cases.

I see. Okay. And also when you get these approvals, especially in that infant age group, how quickly -- I think we talked about the payers, but how quickly when you look at how the patients are treated from a term or pediatric. The pediatric side, you're still ramping up the effort there. How quickly do they -- when these approvals kick in? That the sales or revenue or reflecting...

Sure, the 3 to 24-month AD, I think we're going to see a very rapid adoption. If you think about it today, the only things approved to treat kids under the age of 2 with AD are [ EUCRISA ] or 6 of the topical steroids. -- right? And everyone knows you, [indiscernible] stings and burns. And topical steroids are particularly worrisome in a young kid. So to have a safe, effective once-a-day cream approved in that population, the pediatric dermatologists are forming at the mouth to get their hands on this product. We got the 2- to 5-year-old approval, the response was, when do you get 3 to 24. I was like, what about the 2- to 5-year-olds -- do I get any credit for that there's a huge amount of pent-up demand. I mean anyone who's a parent can just think about what that would mean if they had a safe, nonsteroidal to treat their little baby with atopic.

I see. So even though you haven't really ramped up in that pediatric sort of sales effort yet, a lot of these patients have already been seeing the pediatric derms.

By pediatric derm or just a general derm they aren't very much repeater -- so a lot of little seen by regular genders.

I see. So basically, there's no barrier to -- not in the dermatology space now. even though you haven't really ramped up that pediatric.

Right. I think the pediatrics is an additional additive -- but there's a big opportunity for 3 to 24 months in dermatology.

I see. Okay. Fantastic. No, this has been a very interesting discussion, very helpful for us to help to -- help investors think to ZORYVE story to continue growing in the future. So we're out of time. So before we close the session, I will turn it to you for any final remarks.

Latha?

No. I think our closing remarks are everything is going per plan that we said that we were going to execute on since last year when we had our Investor Day -- we've put out guidance. We updated the guidance, and we feel strongly about our business and the growth trajectory. We are self-sustaining investing in that growth, and we keep to coming back to update the investor community on those investments. So we're excited for the outlook of ZORYVE and a lot of label expansions and pipeline that we just talked about.

Fantastic. Thanks again. Thanks, everyone.