Everest Medicines Limited (6HN.F) Earnings Call Transcript & Summary

Good day, and thank you for standing by. Welcome to Everest Medicine's New Corporate Strategy Launch Conference Call. Please be advised that today's conference is being recorded. [Operator Instructions] At this time, I would like to hand the conference over to your speaker today, Ms. Leah Liu, VP of Corporate Affairs. Please go ahead. Thank you.

Thank you, operator. Hi, everyone. Welcome to our New Corporate Strategy Launch Conference Call. Joining us today are Mr. Rogers Luo, our new CEO, of Everest Medicines; Mr. Ian Woo, our President and Chief Financial Officer; and Dr. Zhengying Zhu, our CMO for Internal Medicine. Before we get started, I would like to remind you that the speakers of this conference call may make statements that constitute forward-looking statements, including descriptions regarding the intent, belief or current expectations of the company or its officers with respect to the business operations and financial conditions of the company, which can be identified by terminologies such as will, expects, anticipates, future, intends, plans, believes, estimates, confident and similar statements. Such forward-looking statements are not guarantees of future performance and involve risks and uncertainties, and actual results may differ from those in the forward-looking statements as a result of various factors and assumptions. The company or any of its affiliates, directors, officers, advisers or representatives has no obligation, does not undertake to revise forward-looking statements to reflect new information, future events or circumstances after the date of this call, except as required by law. I will now turn over the call to Rogers to give you more details on our new corporate strategy. Mr. Luo?

Thanks, Leah. Hello, everyone. Good morning, and good afternoon. Good evening. It's my very much pleasure to invite you all joining this call, and thank you all for attending the meeting. So I'm going to present our new corporate strategy and followed by Ian and Zhengying to present other parts of the presentation. So the first slide actually shows our pathway to our final goal to become a leading Asia-based global biopharma company. We have been -- went through this full journey in the first stage in the last 5 years. We built a solid foundation in the last 5 years, where we licensed 11 assets across 5 therapeutic areas, and we got IPO-ed in the Hong Kong Stock Exchange and divested to date up to USD 480 million. So those are our key achievement in the last 5 years. Between now and the goal in 2025 and beyond last year, 2023, which is this year and next year, 2024, which is the year of transformation, the company will transform from a fully kind of licensing company model to a licensing plus self discovery R&D to kind of driver kind of growth strategy, where we'll be focusing on renal disease and mRNA vaccines and therapeutics. And also, the company will transform from a clinical-stage company to a full value chain covered starting from R&D to commercialization, to manufacturing, full value chain kind of capability. So we are aiming to successful launch Xerava and Nefecon where we can bring more revenue and profit. So that will help us to transform from kind of purely financial market funding kind of more gradually become a revenue -- commercial revenue and profit self-support mode in the last 2 or 3 years. So it's a year of -- this 2 years will be critical as they're transforming the core company to a very different stage. Once we achieve that, then we will go beyond and become a leading Asia-based global pharma company, a biopharma company. Next slide. So in the last 3 months, we have been reviewed our strategy. So here is the outcome. So the #1 strategy actually is the focusing. The company will be focusing on 3 things: Number one is our renal disease. In renal disease, we already submitted our NDA for Nefecon and also we have other assets in our pipeline, including a BTK inhibitor currently in Phase II for glomerular disease and other preclinical -- several other clinical -- preclinical candidates. So we'll also be looking into also licensing opportunities to further develop our whole kind of renal disease portfolio. While we are focusing on this, I think later on, Dr. Zhu will explain why we are focusing on this. At least we have one cornerstone products will be launched next year, and we'll build on that and gradually build our whole pipeline in the renal disease area. Another focusing area is the mRNA platform. So with that platform, we already transferred technology from Providence, and we will -- now we already have built our manufacturing site in the Jiashan City, which is near to Shanghai City, a full kind of GMP/GXP qualified manufacturing sites, we already have down our testing round for media batch, the product is highly qualified and similar kind of quality which shows that we already fully transform the -- transfer the technology to kind of commercial size. And with that technology, we will be developing bivalent COVID-19 vaccine and also we'll -- discovery pipelines also for the therapeutic cancer vaccines and expand to other infection disease vaccines for prevention. So that's another strategic focusing area is mRNA platform. That area will be our -- fully support our events. The third one is, we will also maximize the value of the infectious disease including Xerava. We already submitted our NDA and expect it to launch products in the first half -- and get approval in the first half of next year and also be accelerating the development of taniborbactam and a new generation of polymyxin. So with all this focus, strategic priorities, we have currently a pro forma cash balance of USD 430 million, which we can support of all these strategic priorities. Next step. And we also have a very strong leadership team, including I would say, world-class scientists, including our CMO, Dr. Sunny Zhu, and also our CSO, Jennifer Yang, who has a very broad experienced and comprehensive tracking record in many multinational companies, and we also have a Ian and Neo who have many years experience in the financial market as well as in the BD area. So we also have a strong leadership team to support our strategic focus. Next slide, please. So this is the assets we already have. So I've listed the assets we are currently in the order of short term, midterm and long term. So as I just mentioned, we have 2 assets already submitted on NDA and expect it to be launched next year. And we have several assets in the Phase III, including taniborbactam antibiotic, etrasimod already in Phase III and also ralinepag. So there, we will have 3 in late-stage assets. And we also have early assets where we are looking for global rights. You can see some of the assets we have global rights, including some early-stage mRNA vaccines and future cancer vaccines. We're looking for worldwide rights. So it's -- we kind of balance the kind of short and midterm, looking for certainty, return and success -- high success -- high possibility of success and also looking for future potentials with global rights, for example, the mRNA technology-based assets. So we have a kind of, I would say, a very broad spectrum of these assets. Next slide. So then I turn it over to Dr. Zhu. She will go into talking about our renal strategy and details. Dr. Zhu, please.

Yes. Thanks, Rogers. I think as Rogers mentioned the Everest company's strategic focus, one of the strategic focus will be focusing on renal disease. So my part will introduce a highly unmet need in renal disease, mainly here referred to glomerular disease area in China and in this region, and then we're focusing on Nefecon as a product, the product profile as well as development status and our prep for commercial launch in this year, hopefully later this year. Then the last part, I will introduce our assets, our current assets on renal pipeline expansion, mainly on the internal discovery part. So we all know that different kinds of assault to renal -- to the kidney will cause irreversible damage to the kidney cells and will lead to a final, complete loss of renal function, we call end-stage renal disease here. And in China, on the left side of the panel, we know that -- we noticed that the leading cause actually for ESRD, the most common cause in China is primary glomerular disease, which accounts for more than half of the patients in ESRD, leading to ESRD, followed by diabetes and hypertension. In such, pattern is very different from Western side. In the U.S. and U.K., the leading cause is diabetes, then followed by hypertension and glomerular disease, which indicates this is indeed a lack of effective treatment and has a very high unmet need area. So looking at IgA nephropathy, we know that IgA nephropathy, the diagnosis of this disease is rely on biopsy. So in the biopsy samples in a large study that's collecting more than 40,000 samples, in the case that IgA nephropathy accounts for half of the all glomerular diseases. So we estimate every year in China, it's around 100,000 newly diagnosed biopsy-proven IgA nephropathy and the cumulative, it accounts for 0.5 million patients in province. So in -- for the patient profile usually, the patients will be diagnosed at a fairly early young age. 80% of the patients will diagnose between age 15 to 44 with the median diagnosed age as 30 to 35 years old. So they have a -- this population has a very strong desire to receive innovative therapies. Next slide. So this slide indicates that we -- in glomerular disease, there are many major types of different disease, led by IgA nephropathy. In China, we roughly estimate it will be 4 to 5 million population -- disease population in this IgA nephropathy itself. And if we add up to membranous nephropathy minimal change diseases and FSGS, adding up will close to 10 million disease population. So it's a fairly large population that's suffering this disease. And yes, Nefecon is the first and only approved drug that is indicated in treating IgA nephropathy. And besides that, there is no approved therapy so far globally. And we have, in Everest, we have, fortunately, Nefecon in China and in the surrounding region, and we're hoping to bring this product soon into this region. At the same time, we are committed to bringing more products promising treatment targets in treating these different types of diseases. So including our Phase II -- Phase Ib, Phase II development stage everything in Xerava and other preclinical candidates as well. And next slide. Yes, so let's refocusing back to IgA nephropathy. You may notice that in this region, the prevalence rate of IgA nephropathy is a lot higher comparing to Western side. So there is some genetic predisposition, the risk allele may play some role and some environment factors. And indeed, IgA nephropathy is not a benign disease. So depending on the preclinical level and depending on the renal insufficiency disease, there are up to 50% of the patients may progress to ESRD within the timeframe of 10 to 20 years. So the right-hand side of the figure, actually indicates proteinuria is independent risk factor may impact on the prognosis of IgA nephropathy. So in that particular study, which is a Toronto Glomerulonephritis Registry study showed that proteinuria level greater than 3 grams per day for that population, if you're comparing to the group within proteinuria less than 1 gram per day, the speed of progressing into end-stage renal disease is 25x faster. So indeed, together with other meta-analysis study, it's strongly indicated that proteinuria reduction actually is a very important factor that impacts on the renal function preservation. So that's the whole goal, I think for Nefecon and for other future products with the goal and aim to control, to reduce the proteinuria level and in order to preserve the long-term renal function. Next slide. So Nefecon is a product specifically designed to treat the disease, the IgA nephropathy. So currently, the predominant -- the dominant hypothesis of the disease is the -- the origin is from the gut. It's from the distal part of the intestine, ileum, there are certain lymph nodes like tissues called Peyer's patch, which is the major site of produce IgA1. And in IgA nephropathy patients, the baseline level of galactose-deficient-IgA1 is higher than normal population. So indeed, Nefecon is designed to deliver the highly potent, local active budesonide to the Peyer's patch in order to inhibit overproduction of GD-IgA1, and it is expect to perform as a disease-modifying impact in the disease treatment. So Nefecon is a capsule. So the capsule contains beads and the beads has a triple layers of various kinds of polymers as well as the active ingredient, budesonide. And the capsule has an enteric coating, which will make the capsule intact to go through stomach and the majority of the first part of the intestine. And until it gets to the ileum, the capsule will -- or the beads will come out and release locally budesonide with the aim to reduce the GD-IgA1 production in that particular site. Yes. So this -- the effect of the drug is not -- it's really aiming on the disease modifying and not only just the simple, control or supportive care. Next slide. Yes, so this is the Part A result of Nefecon study, which is a pivotal Phase III registry and registration trial globally. China is part of the study, and this slide shows the Part A results, which if you're familiar with the study design, the study has two parts. Part A will have the patients on optimal dose of RAS inhibitor, stable dose for 3 months or above. The patients will all be randomized to receive Nefecon 16 milligrams of placebo treatment for 9 months and followed by 3 months off drug, and that's composed the Part A. Once the Part A finished, the patient will go through the observational Part B for a period for an additional 12 months. So for the Part A results, which is the full 200 patients, the primary endpoint is the urinary protein to creatinine ratio, UPCR. You'll see that the intended-to-treat patient population with UPCR has a significant and encountered an impressive UPCR reduction to 34% versus Phase I. And notably, when the patient off drug and continue to follow until 12 months, you will see continuous proteinuria reduction in fact to 52%, which is -- it's a notable effect and it's a strong indicator of a disease-modifying effect of Nefecon as well. So the key secondary endpoint is the estimated GFR level. And in the Nefecon treatment group, you'll seen very stabilized renal function with almost unchanged, while in the placebo group, you'll see a very dramatic EGFR decrease with the absolute value close to 4 mL per minute at 9-month treatment, which is really early -- very early positive signal showing that with the reduction of proteinuria, the renal function has been preserved to a very clinical, meaningful level. So for the safety side, as expected, budesonide has a very high effect, a very low, minimal systemic exposure, which is a key difference from the routine conventional systemic glucocorticoid use. So we very expect to see a very well tolerated safety profile or AEs mild-to-moderate. There was no severe infection and there were no adverse clinical effect on cardiovascular or other metabolic effects. So the overall profile is very favorable in treating IgA nephropathy patients. Next slide. Yes. China, as I mentioned, China and the region in Everest territory, Taiwan and Korea, all parts of global clinical Phase III Nefecon study, we opened the sites and had the first patient enrolled in September 2020. And at the time of December 2020, actually, at that time, China CDE, the first time opened the channel for breakthrough therapy designation and Nefecon very luckily get BTTD designation at that time, which I think is a recognition from CDE side as a highly -- huge license in this disease area. And in April 2022, we had our Chinese subpopulation Phase III Part A results readout, which composed 62 subjects. And we are very pleased to see the top line results, including a reduction in EGFR stabilization. The results is highly consistent with overall Part A results. And that's indeed the base plus confirmatory with global Part A results, we filed China NDA and got accepted in November 2022. And this is the first -- actually, the first product in this area that have been able to submit based on surrogate proteinuria endpoint to get conditional approval regulatory pathway, which will substantially accelerate the regulatory process of Nefecon in China. And in just the past month, we got -- acquired the review grant in China as well, which will another sort of a regulatory path, and will enable us to bring this product sooner to the patients. In parallel with the China NDA submission, we also submitted a Singapore NDA in December last year. And we are fully prepared for submission for Hong Kong, South Korea and Taiwan in 2023. We expect the first wave of NDA approval in China, Hong Kong, Singapore this year -- later this year, and we are hoping that we can get the approval in South Korea and Taiwan in 2024, next year. Having NDA submitted and accepted in China, in this region, next slide, so Everest is gearing up to prepare for the commercial launch for these products. As I mentioned that IgA nephropathy diagnosis is relied on biopsy examination. And we believe that in big cities, in big hospitals, it's fairly concentrated market potential and the top 11 provinces may represent a majority of the market potential, and we think that will facilitate our assets in commercial promotions. Then for the -- we know that almost 2/3 of the subjects may not be able to have biopsy results. And we are thinking that we will roll out the medical educational program to enhance the disease management as well at a prelaunch stage. So for -- we know that NRDL is critical to get the Nefecon to more patients in the region, and we will closely work with all the key stakeholders and hopefully to get NRDL listing in first half of 2025. Next slide. And so as I mentioned, that Everest is committed in the renal disease area. We're hoping that we can -- we are actively building our knowledge in the disease biology area. And we know that in -- although in different types of glomerular diseases, some of the results in the larger proportion actually are shared between different disease types. So there are -- this includes the autoantibody production. And in IgA nephropathy, as I mentioned, that we know that GD-IgA1 has a defect, autoantibody triggers the downstream complement activation and causes the damage. Similar, as membranous nephropathy, the autoantibody anti-PLA2 receptor actually attacks the podocytes and triggers the complement or common pathway. So we know that the autoantibody production, downstream complement pathway activation and the critical target cells in the glomeruli, especially the podocytes are very attractive disease target for us. So we are building a lot of -- generating, accumulating our knowledge and understanding for the different disease pathways. And so for our -- for example, for our EVER001, which is a BTK inhibitor, which has a potential to inhibit the B cell function and interfere the autoantibody production, which may have potential to treating membranous nephropathy. And we are indeed hoping to initiating our Phase Ib study soon in this year and generating some early signal data readout in the later part of this year. And also, we have other preclinical candidates addressing the podocyte morphology and podocyte function, which is sort of a common defect in the glomerular filtration area, which will -- is a defect present in different kinds of glomerular disease. So we're continuing these assets, and we're hoping that we can bring more promising targets and can share more news with you in the future. Okay. Let me stop here and hand over to Ian.

Thank you, Zhengying. So as Zhengying just spent some time going through a core priority of Everest, our Nefecon and the renal disease space. I think I will continue the presentation by talking about another priority for the company, which is developing our mRNA vaccines and therapeutics based on the platform that we brought in from Providence. What we have today, we believe, is a leading mRNA platform that is clinically validated, and that has end-to-end capabilities. What we have today is the ability to design antigens and mRNA sequence in a way that can quickly produce highly effective mRNA candidates. We also have access to an LNP system, which we are actually working with Providence to continue to improve with desired characteristics, such as enhancing cell-mediated immunity. And we also have a production process that is well validated and have brought in a group of R&D team that has a couple of decades of experience in virology, immunology, bioinformatics, structural biology and clinical research. And this is a platform that we're continuing to improve upon. But today, I think we are very confident that we have the foundation set for the ability to develop and research and discover new vaccines and therapeutics out of this platform. Next slide. This is our current mRNA pipeline. You can see that the most advanced programs are our COVID-19 mRNA vaccines. The first-generation PTX-COVID19-B product is getting ready for a Phase III clinical trial globally. This will be run by Providence Therapeutics, our partner, and Everest will also contribute and participate in that Phase III study. In China, we are focused on advancing our bivalent COVID-19 vaccine. This is the product where we have announced that we have initiated rolling IND submissions, and we are expecting to receive IND approval in the first quarter of this year and initiating Phase I and Phase II studies shortly thereafter. On the non-COVID-19 mRNA product side, we have announced that we have received a preclinical proof of concept with a rabies vaccine candidate. This is in a 50-50 collaboration globally with Providence, and we look forward to continue to advance this product and hope to file -- start filing an IND on this product before the end of 2023. At the same time, we are working on multiple preventive and therapeutic mRNA products, some of these are in collaboration with Providence, others where we have for global rights. The cancer vaccine program is an important effort for us because we really believe the potential for the mRNA platform, not just for prophylactic vaccines but also for therapeutic vaccines. On the bottom of the page is the production process that we have localized at our manufacturing facility in Jiashan, including DS and DP production and fill finish. Next slide. This is a picture of our Jiashan facility, which we started building in March of 2020. And the phase 1 construction has completed in September of 2022. This facility is built to the global standards, and we certainly hope when this is fully operational and when our products are approved, we will be able to supply out of this facility for China as well as ex China markets. We announced that we commenced operations at this facility in December of last year. We have run a number of familiar batches at the facility and are quite confident that we have been able to successfully tech transfer industrial scale production from our partner to this Jiashan facility. This facility is designed for an annual capacity of 700 million doses of mRNA vaccines. Next slide. So when we say we have a clinically validated mRNA platform, this is part of the reason why we are so confident about the technology that we have. Providence has run a Phase II study for PTX-COVID19-B. This is our first generation COVID-19 vaccine head-to-head against Pfizer's first-generation COVID-19 vaccine, COMIRNATY. This trial was run in Canada and in South Africa. And you can see that this is a 2:1 randomization with a safety follow-up for 12 months. And what we have been able to show is that we are able to deliver noninferiority in terms of the level of antibody generated against COVID-19 vaccine. So this is the analysis on the bottom. You can see that 2 weeks after the second vaccination that we are able to deliver similar levels of neutralizing antibody levels as COMIRNATY. Next slide. This slide shows the safety data of PTX-COVID19-B versus COMIRNATY. You can see that the systemic and local adverse reactions after the second dose between the 2 vaccines are quite similar. Our PTX-B vaccine candidate, you can see that actually has numerically better safety profile as COMIRNATY from a statistical basis, it is noninferior. And so we are quite confident that not only do we have an effective COVID-19 vaccine, we have one that is quite safe to use. And this is really -- we think it's quite differentiated because a number of our competitors in China have had a pretty significant safety signals with their mRNA vaccine candidates. Next slide. This is some preclinical data from our bivalent COVID-19 vaccine. You can see that in the chart on the left that we are comparing to boosting with PTX-COVID19-B, our first-generation monovalent vaccine versus the dark blue bar, which is the BA2.12.1 monovalent COVID-19 vaccine versus the light blue bar, which is the bivalent vaccine candidate. And the bivalent vaccine candidate is a mixture of PTX-COVID19-B and the Omicron-specific monovalent vaccine against the BA2.12.1. You can see that the bivalent vaccine is able to generate much higher neutralizing antibody titers in this pseudovirus challenge study in mice. Next slide. This is the development time line for our COVID-19 vaccines. We are in rolling IND submission for our bivalent candidate, and we expect to initiate Phase I and II studies in the second quarter of this year. We hope to be in a position to submit EUA for this candidate before the end of 2023. On the bottom of the slide, it's the -- this is the PTX-COVID19-B, our first-generation product, which we intend to initiate a booster study against Pfizer's COMIRNATY. This will be -- this Phase III study will be led by Providence and run outside of China. Next slide. We are quite excited about the potential for COVID-19 vaccines going forward. Clearly, China has reversed on the zero COVID policy, and we believe this will drive an attractive seasonal market going forward. Our assumption is that approximately 30% of the population will take annual boosters and this will translate to 400 million to 500 million doses. Our assumptions for pricing is RMB 100 roughly per shot. This is a mix of public and private markets, and we believe that the public government procurement markets will be slightly lower than RMB 100 per shot, but the private pay market will be higher than that. So on a blended basis, our assumption is RMB 100 per shot, which will drive a market of RMB 40 billion to RMB 50 billion. And we believe that mRNA vaccines as a class should be able to capture about 50% of this. And we think these numbers are reasonable, especially compared to the -- how we expect the flu vaccine market to evolve in China. Currently, the flu vaccine market is roughly about RMB 5 billion but this is growing at a double-digit CAGR. And for the next 5 years, it will grow to about RMB 10 billion, which translates to a 10% penetration in China. Given the severity and the disease awareness for COVID, we believe that it's reasonable to assume that the penetration for COVID-19 vaccines should be 2 to 3x higher than flu. And hence, these numbers is our current assumption. Next slide. So switching gears a little bit to our antibiotics portfolio. We're quite excited about our antibiotics portfolio because we have 3 products that have complementary spectrum of coverage across multidrug-resistant gram-negative infections. The latest stage product, eravacycline, is a fully synthetic tetracycline that we believe will be -- will be the third MDR gram-negative antibiotic approved in China in the last 10 years. There is a significant unmet medical need for these type of products. And I can show you some revenue data on the next slide. But taniborbactam is our second product in the antibiotics portfolio. This is a novel beta-lactamase inhibitor that will be used in combination with cefepime, the spectrum of coverage across beta-lactamases is very attractive with taniborbactam. For example, it has very good coverage against the metallo beta-lactamases. And we think this drives the best-in-class profile for this product. We have announced a positive global Phase III study for taniborbactam in complicated UTI and we are negotiating with the regulatory authorities and hope to submit NDA for taniborbactam in 2023. The last asset in the antibiotics portfolio is SPR206, this is a novel polymyxin derivative that has significantly reduced the renal tox, which has been a key issue with the broader commercial adoption of polymyxins in the past. We think this profile will drive significant commercial potential for SPR206 if this can be can be repeated in the Phase III study, which we intend to start this year as well. If you look at the next slide, you can see that polymyxin tetracycline and Zavicefta, which is another beta-lactamase inhibitor marketed by Pfizer together drive significant revenue increase in China. And these are the life-saving drugs in the ICU. When you come down with infections against -- with pseudomonas or Acinetobacter baumanii infections that are resistant to carbapenems, you really don't have other options. And these are the only products you can use. And hence, you see the significant increase in revenue over the last few years. The pricing for these products are also quite attractive. Polymyxins are dosed at about RMB 6,000 to RMB 9,000 per day and Zavicefta, the beta-lactamase inhibitor from Pfizer, has a daily cost of about RMB 4,000. We have -- other than I think the overall attractive antibiotics market in China, we actually have had some experience with eravacycline. The trade name here is XERAVA. Sales in Singapore. We have been commercializing in Singapore for about 12 months now. And for the hospitals that we have been able to get listings in, we have been able to replace 80% to 100% of the tigecycline volume. In some hospitals, we have been able to expand on that. So we certainly feel that given our own experience in Singapore and the market research that we have done in China, that the potential for XERAVA and for the rest of the gram-negative antibiotics portfolio that we have is very attractive. Next slide. Last but not least, I wanted to just spend a couple of minutes talking about Etrasimod. This is a potentially best-in-class therapy for ulcerative colitis and other autoimmune diseases. This is an S1P modulator that we brought in from Arena Pharmaceuticals that was subsequently purchased by Pfizer for USD 6.7 billion. And we are in collaboration with Pfizer to advance the development of this product in UC, but also in other auto immune diseases. You can see here that in terms of where we are in development, Etrasimod NDA has been submitted for UC in the U.S. and EU. In China, we have a regional Phase III studies study that is ongoing, and we expect to complete enrollment for this study in the second quarter of this year and have data starting to come in for 12-week and 52-week towards the end of this year and into next year. We are working with Pfizer closely on defining the development strategies and plans for Crohn's disease, atopic dermatitis and other autoimmune diseases. You can see that these are diseases that the prevalence and incidence rates in China are growing quite rapidly. And with atopic dermatitis, the number of patients is very, very significant. And we believe that Etrasimod has the best profile to be able to target these diseases and offer an attractive option for patients. The next slide, shows the data that we have for Etrasimod. You can see that on the left, these are not head-to-head, but just the data received from different trials. So you can see that for Etrasimod at 52 weeks is able to deliver about 27% of the subjects to have a remission in -- to have a clinical remission. And that's quite attractive compared to the biologics, which are really in the high teens, right? The -- really the only product that has a higher efficacy is the JAK inhibitor, slightly higher. But the JAK inhibitors, as you all know, come with a black box warning labels and have a lot of safety considerations. So again, what we believe is that etrasimod has the best combination of safety, efficacy and convenience which we believe is the right profile for these autoimmune diseases. Next slide. This is just to share with you some of our track records with our business development activities in the last 4 to 5 years. Five of the products that we have brought in have been in a global sale or acquisition by larger entities. Our partners span across the globe in Europe, North America and in Asia. And certainly, I think we have a proven track record in our ability to bring in assets that create value and deliver on value creation. This is important because as Zhengying and Rogers has mentioned, we will continue to use business development to complement our internal discovery platform and being able to expand our pipeline through both organic and inorganic means, I think will continue to remain our strategy. Next slide. We're looking at a catalyst-rich 2023. So hopefully, this will certainly keep us busy and hopefully will create the value inflection points that we're all looking for. So first, we are very excited to look for the NDA approvals for Nefecon in IgAN and XERAVA in complicated IAI across our territories in Greater China and in South Korea. We are looking forward to receiving the IND approval for a bivalent MRA COVID-19 vaccine and initiating Phase I and Phase II studies towards a possible EUA in China. We're looking to complete our Phase III UC trial enrollment in the second quarter of this year and working with Pfizer on additional indications. We're looking to start our Phase III study for SPR206 in China. And we're looking for IND filing for our first non-COVID mRNA product, our rabies vaccine. And we're looking to submit our -- the NDA for taniborbactam, our second antibiotic product in China as well. Okay. So with that, I will wrap up. And Leah, I'll pass it on to you for managing the Q&A.

Okay. Thanks. [Operator Instructions] The first question comes from Goldman Sachs, Lai Chen.

Hello. Can you hear me?

Yes.

This is Lai Chen from Goldman Sachs. I think the strategy has been coming very clear after the reorganization and the new strategy launches. Just one question on the prioritization because you mentioned about the key focus in the future is going to be on renal diseases on mRNA platform and also potentially some of the antibiotics. But what about the products and the candidates in the pipeline that also looks pretty promising, including etrasimod, including ralinepag, particularly those have late-stage data. So what's going to your beer plan? Are those assets ready to sell? Or you're actually looking for some of the partnerships?

Ian, you go first. Yes.

Sure. Okay. Thank you for the question. I think for etrasimod -- what we -- with etrasimod, I think what we have is we have a little bit more time to really figure out your questions. At the moment, I think -- we have no plans to divest any other products, okay? What we think is that over the course of 2023, we will be building out our commercial organization. So for sure it will be -- we will be commercializing Nefecon on our own. With XERAVA, I think what we say is we want to maximize the commercial potential. And I think what that means is it may be a combination of our own internal efforts as well as the help from third parties, maybe a CSO that can help us go deeper and broader. But those discussions are still ongoing, right? So what we will have coming out of 2023 is a robust and active commercial platform, which can certainly commercialize etrasimod on our own if we choose, okay? And that -- you should think of that as our base case. And if somewhere along the line, somebody makes an offer that we cannot refuse or that we think we can put more resources behind a product like etrasimod to benefit patients, it is clearly something that we will consider. But our base case is to commercialize our pipeline on our own.

Yes. I think, Ian's statement, is pretty clear. I think later, when I joined Everest, I think we have a kind of a good problem to have. We have so many late-stage assets and then we -- it's hard to decide where we want to do all by ourselves or we just focus on the maximize the value. So I think Ian just mentioned our strategy. I think it's in time once we have our full capability optimization and we -- along the way, we will be thinking about which is the best way to maximize for better.

And also another question is really on the commercialization strategy for Nefecon and also the renal disease for sure. So we do see a huge amount of IgA nephropathy patients in China. And of course, biopsy or diagnosis probably will be one of the hurdles. And we try to understand about the opportunity is pretty significant there, but we haven't seen any of the major drug in the space yet. So what has been the hurdles to achieve a blockbuster kind of a sales milestone for any of the renal disease drugs. Is it not good enough? Or for Nefecon is going to be a very different story?

I think -- I'll go first. So I think it depends on the product itself, as you mentioned in the past several years, there is no -- I would say there's no true innovation in these sectors as Dr. Zhu mentioned in the last probably 50 years, there's no innovative drug being approved in this IgA nephropathy. And even on the renal disease, I don't think we can find any other should innovative products in this sector. That's the #1 reason why you do not see a huge blockbuster, which means it's exceeding RMB 3 billion sales in China alone. So that's the, I would say, the biggest reason. The other one is that I think there is not even for me-better or kind of me-too drug in this sector, that's very few. I think the reason, as Dr. Zhu mentioned -- 2 major reasons. Number 1 is that for glomerular disease is not a focused area for national big pharma companies. Number 2 is that the FDA used to use outcome-based endpoint to prove the drug. There's no surrogate endpoints to be evaluated for approval. So Nefecon is the first one, I would say. So that's the drivers -- there's not much many innovation in this area. So for the commercialization of this kind of, I would say, breakthrough innovation product like Nefecon in China, I think will be different of the commercial approach, as you just mentioned. As we have this very strong data, I would say Nefecon is not a kind of [indiscernible] lowering their proteinuria, it is disease-modifying, I would say, disease-modifying potential mapping for this disease, which means it's not only lowers the proteinuria, but also stabilize the eGFR, decrease the -- I would say, delay the progress to the end stage renal disease, that would be the foundation therapy for this disease. So in terms of commercialization, I think basically 3 things. I always said there's 3 things about commercialization. Number 1 is the medical disease education -- medical education, number 2 is about market access. Number 3 is about the promotion sales market. So if you're looking at this product profile, I think it's very heavily rely on market sales and also medical affairs. Sales and marketing also important, but may not as important as other products. Like you may remember in other diseases, you have thousands of solid sales reps on the ground. But this product, I think, is kind of first in disease, breakthrough, those kind of things, you need a lot of medical drive, guideline promotion, guideline drive, education plus reimbursement, which is market access in terms of reimbursement for those kind of things, sales marketing, of course, important, but not as -- we would not hire thousands of sales reps on the ground, so which means we are looking for higher kind of return on investments. So that's probably -- this is a very highly concentrated market as just mentioned about. We are not only looking into those patients with biopsy-proven kind of IgA nephropathy, but also looking to those patients, highly -- highly likelihood of IgA nephropathy with other clinical diagnosis and not quite responds to the -- of course, suboptimal kind of response to RAS inhibitors, right? That's a huge population. If you're looking at the biopsy in China, it's about 300,000 patients a year, there would be another 600,000 or even more patients who are very reluctant to have the biopsy, but they're highly likelihood of being IgA nephropathy patients. So that's an even bigger patient pool to tap into. So I think this product has huge [indiscernible] , and we will apply a different approach for the product for a much higher obviously, blockbuster kind of potential materialization.

The next question comes from Yang Huang of Credit Suisse.

Thanks for the presentation and thanks for the opportunity to allow me to ask questions. So basically, I have 2 questions. First, to my understanding, unless the partner Calliditas guided their 2022, last year's full year revenue for NEFECON is about USD 35 million to USD 40 million. And so if we assume the price of NEFECON in U.S. is about $100,000. That means a few hundred patients were treated last year. So based on that numbers, so what can we see for the NEFECON after NEFECON's approval for NEFECON's first year in China sales? So that's my first question. .

Rogers, you are on mute.

Probably, I think you can answer the first part of the question about the prevalence in the U.S. And was there kind of market kind of potential in the U.S. and I can comment on the China part.

Yes. Okay, so in terms of the patient number, I think if we're looking at the prevalence or the accumulated IgAN population in the U.S., it's around 150,000 in that range to 100,000 to 200,000. But of course, these are maybe including [indiscernible] patients as well. So from that number size, it's a lot smaller than China size, that's the epidemiology part.

Yes. Please?