Nuvation Bio Inc. (NUVB) Earnings Call Transcript & Summary

Good afternoon, and welcome to the Nuvation Bio First Quarter 2025 Financial Results and Business Update Conference Call. Please be advised that today's conference call is being recorded. [Operator Instructions] I would now like to turn the call over to J. DeVita Executive Director of Corporate Development and Investor Relations at Nuvation Bio. Please go ahead.

Thank you, operator, and hello to everyone joining us today. We recently issued a press release announcing the U.S. FDA approval of Taletrectinib, now known under the branded name Ibtrozi in the United States. Ibtrozi is a next-generation oral tyrosine kinase inhibitor or TKI for advanced ROS1-positive non-small cell lung cancer, or NSCLC. This press release and an updated corporate presentation are available on the Investors section of our website at nuvationbio.com. A replay of today's recording will be available shortly after the conclusion of this call. Joining me today are Dr. David Hung, our Founder, President and Chief Executive Officer; Philippe Sauvage, our Chief Financial Officer; and Kerry Wentworth, our Chief Regulatory Officer. Today's discussion will focus on the FDA approval of Ibtrozi, our launch plan and next steps as we bring this important new medicine to patients. We will be making forward-looking statements on this call, which are based on our current expectations and assumptions. Because such statements deal with future events and are subject to many risks and uncertainties, actual results may differ materially from those in the forward-looking statements. For a full discussion of these risks and uncertainties, please review our annual report on Form 10-K and our quarterly reports on Form 10-Q that are filed with the U.S. Securities and Exchange Commission. Now I'll turn the call over to Dr. David Hung. David?

Thanks, J.R., and thank you all for joining us today. This is a truly exciting moment for Nuvation Bio and more importantly, for people living with ROS1-positive non-small cell lung cancer. Today, they have a new treatment option. With the U.S. FDA approval of Ibtrozi, Nuvation Bio is a commercial stage company, launching what we believe is a best-in-class ROS1 inhibitor and the first of several differentiated medicines in our broad pipeline. We know that behind every data point used to achieve this approval is a person, a parent, a partner, a colleague whose life has been disrupted by this aggressive disease. And for many of them, the emotional and physical toll can be overwhelming. This approval means patients now have access to a new targeted therapy designed specifically for their form of lung cancer with the potential to hold their disease at bay and help them focus more on moments that matter. Before I talk about the clinical data and what this means for the company, I want to begin with sincere gratitude. In addition to the patients, I would also like to thank their families, the investigators and the clinical teams who made our studies possible. Furthermore, we want to acknowledge the Herculean efforts of the FDA reviewers and inspectors assigned to this high priority NDA submission. As you know, Ibtrozi had been granted breakthrough therapy designation by the FDA in both the first and second-line setting. No other drugs currently in development has this designation. Ibtrozi accordingly received priority review for its NDA submission, and we are so pleased to receive approval weeks prior to our PDUFA date of June '23. And finally, I would like to thank the dedicated team at Nuvation Bio for their relentless focus, persistent passion and unwavering commitment that resulted in today's announcement. At our core, Nuvation Bio has always been motivated to challenge the status quo in cancer treatment, especially in some of the hardest-to-treat cancers. This approval is a meaningful step towards that goal. As mentioned previously, ROS1-positive lung cancer is a particularly aggressive disease. It is a rare genetically defined form of lung cancer and for the people it affects, the burden is significant. Most are young, on average, about 50 years old and are otherwise healthy people who have never smoked. And despite having targetable mutations, they unfortunately face a high risk of disease progression. To address this unmet need, we developed Ibtrozi, a next-generation, highly selective ROS1 TKI now approved for the treatment of adults with locally advanced or metastatic ROS1-positive non-small cell lung cancer. Ibtrozi was designed to address the real-world challenges patients face when battling this disease, especially when it comes to durability, tolerability and the ability to shrink tumors in the brain and treat the most important pathways through which these cancers develop resistance to other therapies. Now let us walk you through the registrational data set that was the basis for the FDA's decision. The approval of Ibtrozi is supported by one of the largest global clinical trial programs in ROS1-positive lung cancer to date, including a safety database of more than 400 patients. And this database continues to grow. Since NDA submission, we have enrolled additional patients in the global TRUST 2 study, which now includes more than 135 patients from North America and Europe. As you know, the full results from the TRUST 1 and TRUST 2 studies were recently published in the Journal of Clinical Oncology, or JCO. As summarized in this publication, in the TRUST 1 and TRUST 2 studies across different lines of therapy, Ibtrozi showed consistent durable responses, strong intracranial activity and was generally well tolerated, including a low rate of discontinuation and tolerable central nervous system or CNS effects. In a poster presentation at the ASCO conference, we reported that the efficacy and safety profiles observed in TRUST 1 and TRUST 2 were remarkably consistent across demographics and regions, reinforcing the applicability of Ibtrozi data across diverse patient populations. While our JCO publication and our initial NDA submission reflected pooled results from the TRUST 1 and TRUST 2 studies, the Ibtrozi label presents the results from each study individually. This was based on discussions with the FDA, mainly driven by differences in the median follow-up between the 2 studies. As a reminder, TRUST 2 was initiated over a year after TRUST 1. In addition, the label reflects more mature data cutoff than prior presentations, reinforcing the strength of the findings now shown separately. Now I will discuss the latest data as presented in the Ibtrozi label, unless otherwise noted. In TRUST 1, Ibtrozi achieved a confirmed overall response rate or ORR of 90% in patients who didn't previously receive a TKI treatment, also known as TKI naive. In addition, the median duration of response or DOR was not yet reached with a median follow-up of response of 40 months. The longest DOR observed was at 47 months and is still ongoing. These findings were reinforced by the TRUST 2 results with a confirmed ORR of 85% in TKI-naive patients. The median DOR was also not reached in patients enrolled in the TRUST 2 study. However, this information is not presented in the label given the shorter follow-up time. The longest DOR observed was at 30 months and is still ongoing. We believe that the results in TKI-naive patients in TRUST 1 and TRUST 2 are striking. You've all seen the median DOR and PFS for Taletrectinib in our previously mentioned JCO publication. That data set was based on a data cutoff date of June 2024, nearly one year ago. Our label discussions with FDA were based on a more recent data cutoff of October 2024 with respect to duration of response. As a result of the more recent data cutoff, Ibtrozi's response durability metrics in our label are not yet reached in the TKI-naive patients. We're pleased with the resulting label, which we believe reflects Ibtrozi's powerful and durable efficacy, and we anticipate further label updates as data mature with more follow-up time across both trials. As you know, Ibtrozi's very first clinical trials were initiated a little over 9 years ago. As an example of what Ibtrozi's durability of responses have meant for TKI-naive patients, in a recent follow-up of the 15 patients dosed in one of the earliest ever studies for Ibtrozi, a Phase I study in the TKI-naive setting, one patient has now exceeded 8 years of treatment and two others have now exceeded the 9-year mark, all three patients still continuing to receive Ibtrozi. In addition, one of the patients on therapy for 9-plus years currently has no evidence of residual tumor, otherwise known as a complete response. The fact that 20% of our 15 patients with a cancer as aggressive as ROS1 non-small cell lung cancer are still continuing to receive Ibtrozi approaching a decade from treatment initiation is something that I personally have not seen in my career as an oncologist and biotech executive. We look forward to future follow-up data to see how long the benefits of Ibtrozi might further extend in this setting. Robust results were also observed in patients previously treated with a ROS1 TKI, also known as the TKI pretreated population. In TRUST 1, TKI pretreated patients who received Ibtrozi achieved a confirmed ORR of 52% and had a median DOR of 13 months with median follow-up of 33 months. And in TRUST 2, our predominantly Western study, TKI pretreated patients treated with Ibtrozi achieved particularly impressive results, including a confirmed ORR of 62% while not included in the label given the shorter follow-up time, the TRUST 2 data submitted to the FDA as of October 2024 showed a median DOR of 19 months in the TKI pretreated setting, which compares favorably to our previous median DOR of 17 months in the pooled TRUST 1 and TRUST 2 results as published in JCO. And perhaps just as importantly, Ibtrozi demonstrated meaningful intracranial activity in the second-line setting across both the TRUST 1 and TRUST 2 studies. This is seen through its confirmed intracranial ORR of 63% with 15 of 24 patients with CNS metastases who had not received radiation therapy within 2 months prior to study entry responding to Ibtrozi. Intracranial response rate is critically important in ROS1-positive lung cancer since CNS progression has the greatest impact on long-term survival. So having a medicine that has the potential to deliver tumor response in the brain can make an enormous difference for these patients. Regarding safety, Ibtrozi was generally well tolerated and is presented in the label combined across both pivotal TRUST 1 and TRUST 2 studies. Most adverse reactions were low-grade, transient and manageable. The most frequently reported adverse reactions greater than 20% were diarrhea, nausea, vomiting, dizziness, rash, constipation and fatigue. The most frequently reported grade 3 or grade 4 laboratory abnormalities greater than or equal to 5% were increased ALT, increased ASP, decreased neutrophils and increased creatine phosphokinase. Regarding CNS reactions due to Ibtrozi and specifically dizziness, the rate was 22% and more than 90% of this dizziness is grade 1 and transient lasting about 3 days. It is also worth noting that our label does not include any warnings or precautions related to CNS effects. Additionally, while diarrhea was the most common GI event due to Ibtrozi, the vast majority of this diarrhea was Grade 1 occurred in about 2 days of starting therapy and was resolved in about 1 day. Overall, the most common adverse event with Ibtrozi is elevation of liver function tests or LFTs, and our label addresses elevated liver enzymes with monitoring every 2 weeks during the first 2 months of treatment and then monthly thereafter as clinically indicated to support patients following therapy. We are very pleased that this liver monitoring is simple and generally follows standard of care practice. Elevation of LFTs is well understood with TKIs and oncologists are accustomed to managing these generally by dose reduction, interruption or if necessary, drug discontinuation. To me, the best way to assess tolerability is to observe the rate of drug discontinuation. And in our studies, patients infrequently discontinued Ibtrozi due to treatment-emergent adverse events, or TEAEs. In fact, the overall drug discontinuation rate for Ibtrozi due to TEAEs was just 7%, which is low in this space. Finally, in addition to being efficacious and generally well tolerated, Ibtrozi is convenient for both patients and prescribers alike with simple once-daily oral dosing of Ibtrozi at 600 milligrams and no need for dose loading or titration. We believe this allows physicians to confidently prescribe Ibtrozi and supports long-term use for patients. So what does all of this mean for Nuvation Bio as a commercial stage company? We believe the market is prime for new alternatives like Ibtrozi, and we've built a commercial infrastructure that's ready to deliver. Our team brings on average 15 to 20 years of deep experience launching therapies in complex biomarker-driven environments, including at successful oncology companies like Medivation, Mirati and Seagen. We've assembled 47 oncology account managers, supported by regional marketing and field access teams, all focused on removing barriers and accelerating adoption. We know that adoption will hinge in identifying eligible patients. And over the past several months, we created a blueprint for success for the Ibtrozi launch that ensures timely access for patients, strong provider engagement and operational excellence from day 1. We're especially focused on testing, which remains one of the biggest barriers in this space and contributes to widespread underdiagnosis and undertreatment. ROS1 testing rates still lag behind EGFR and ALK despite inclusion in clinical guidelines and up to 64% of patients eligible for precision oncology treatment in the U.S. have yet to receive a match therapy for published data in advanced non-small cell lung cancer. We believe this poor match rate is due to a number of factors beyond inadequate testing, namely the inappropriate use of IO chemo. Our market assessments indicate that currently, a significant number of patients with ROS1-positive lung cancer are receiving IO chemo in the first-line setting. On January 7 of this year, an update from prior guidance, the NCCN now recommends that TKI-naive patients with ROS1-positive lung cancer being treated with IO chemo should have that treatment interrupted and be switched to a ROS1 TKI. And in fact, IO is now contraindicated in patients with a ROS1 mutation. Furthermore, we believe that the current incidence of ROS1 lung cancer is underestimated by DNA-based NGS testing. We are working to increase awareness and utilization of RNA-based testing, which was introduced last year. We believe RNA-based testing will become the new NGS standard of care as it is approximately 30% more sensitive in detecting ROS1 fusions than current DNA testing. Our commercial and medical teams understand these issues and are well positioned to resolve them. Now I'd like to briefly touch on market access, pricing strategy and patient support. We're excited that Ibtrozi is now available to order in the United States through specialty distribution for a competitive gross price of $29,488 per month. This price is below the current gross price of Augtyro and was carefully selected to ensure timely and efficient market access to those in need of Ibtrozi. We're actively engaging payers, and we expect coverage policies to align with the label. We're also proud to introduce our patient support program, NuvationConnect, designed to support appropriate patients throughout their treatment journey and ensure fast, affordable access. The program includes benefits investigation, co-pay support, dedicated patient services and reimbursement navigation. To our knowledge, this is the most comprehensive support program available to patients. We are extremely well prepared and excited for this next chapter. We have a differentiated therapy, a different and highly experienced team and a different go-to-market launch strategy. But most importantly, we remain driven by the patients who have been waiting for a medicine like this, one that offers deep durable responses, strong CNS activity and a manageable safety profile. With the Ibtrozi approved in both the U.S. and China and other global filings underway, we're positioned to expand access to this important medicine and execute with discipline and we continue to do so from a position of financial strength. With this FDA approval following our first commercial sale, we are poised to receive up to $250 million in non-dilutive financing from Sagard Healthcare Partners, which will further reinforce our already strong balance sheet. Our cash position will easily cover the launch of Ibtrozi and the advancement of our broader pipeline and still allow us to achieve profitability without the need to raise additional capital. Furthermore, any excess cash may be used to secure or develop new assets through business development activities, which are currently ongoing. In closing, I'd like to emphasize that every successful launch is about far more than just commercial metrics. It's about patients. Specifically, how many lives can we positively impact? How many patients can now wake up with a little more hope and a little less fear. Here at team Nuvation, we are humbled and honored to play a role in delivering these benefits to patients. With that, I'll ask the operator to please open the line for questions.

[Operator Instructions] our first question comes from Kaveri Pohlman from Clear Street.

Congrats on the approval and favorable label. Considering your go-to-market strategy, I just want to understand how will you structure your focus strategy for ROS1 patient community? What volume and classifications of health care institution will rank as your primary targets factoring in patient population density? And what share of the complete available patient market do you foresee capturing via your initial launch and promotional activities? And I have a second question.

Thanks, Kaveri. So we have 47 sales reps in the field right now. The majority of patients are still in the community. So we have been on the road for months now, just speaking to different health care systems and educating people on the -- on not only the ROS1 landscape, but also the recent changes in the NCCN guidelines. What's very interesting about the community setting now is that most oncology practices have been consolidated into large health care systems, which makes our ability to reach practices much easier given that consolidation. What's also been interesting to us is that over just the last few months, looking since the NCCN guideline changed on January 7, we've already seen multiple health care systems change internal guidelines to reflect the contraindication of IO for ROS1 and the requirement to use a ROS1 agent for ROS1 non-small cell lung cancer. When we look at the current agents that are previously approved in that space and look at our label, we think that our label is clearly the superior label. And we believe that our combination of efficacy, especially durability and CNS coverage, combined with our tolerability, makes our drug the clear treatment of choice for this indication. Interestingly, right after ASCO, Nathan Pennell from Cleveland Clinic made a comment that he expected Taletrectinib to become treatment of choice for the vast majority of patients with ROS1 lung cancer, and we certainly agree with that. We've been pleased with the response that we've had from most of these health care systems that we've hit and as well as KOLs in the field. And even though this is a relatively rare mutation and type of lung cancer, given the way that the community health care has evolved to be consolidated under practices now instead of waiting for a practice to have a case of ROS1 every 1 or 2 years because these practices now are consolidating such large health care systems, every health care system pretty much sees ROS1 every year, which makes it a lot easier to build awareness within the health care system, and with their own internal guidelines, we think that's really a great tailwind to have. If you look at our -- to answer -- and then also just to answer the last part of your question about what share of the market do you expect to capture. If you look at the benefits of Tagrisso, osimertinib over its competition, and if you look at the benefits of Taletrectinib Ibtrozi over its competition, we think that the benefits of Taletrectinib are significantly larger over our competition than Tagrisso over its competition. And yet, as you know, osimertinib has virtually 100% market share. So we expect to capture the vast majority of this market. We think this is a large market just by -- if you just multiply the number of new patients per year by our recently announced price, that's about $1 billion of new patients per year. But given a PFS that so far is already around 4 years, but maturing and we believe could extend even significantly further, that stacking will lead to about $4 billion a year of total potential sales by year 4 based on current DNA testing, RNA testing, which is going to become standard of care, will affect about 30% more ROS1 fusions than DNA. So that $4 billion a year market should theoretically increase to about $5.2 billion. We think we should capture far more than 90% of that over time given just the benefits we have over our competition compared to Bristol over its competition. So we think this is going to be a really big drug, and we're excited that our data have matured in this fashion, and we are -- and the feedback we've gotten really substantiates and validates that.

Got it. All right. That's very helpful. And regarding the label, given the 2-hour food restriction before and after dosing due to the QT risk, curious about patient and physician comfort with this requirement. Do you anticipate any impact on uptake or adherence? And are there any examples of other drugs where it hasn't been a concern?

I mean we have really no concerns at all about this restriction. I mean there are 4-hour days, most people don't eat for some 4-hour day in their window. This is a QD drug, not unlike repotrectinib, which is a BID drug. So you're right there, you're really talking about a drug that's far easier to take at some time in a day. There is no dose adjustment with Taletrectinib unlike repotrectinib. So we don't think that it's going to be any issue at all to find a 4-hour window that you can take this drug.

And I'll just add to that, that this is how we conducted our clinical trials and there were no issues.

The next question comes from Leo Timashev from RBC Capital Markets.

I wanted to ask on the label. I mean, given that you've shown longer PFS and DOR benefits, but that's not necessarily -- those numbers aren't necessarily fully reflected in the label. I mean, can you still detail into that given that you have publications? And I guess when physicians look at the overall profile, I guess, how much of a differentiator was the increased efficacy versus perhaps the tolerability benefits that you guys have?

Yes. So I can certainly tell you that by far, the most important factor that determines treatment decisions is the durability of responses. I mean we've always said all along that by far, the greatest safety risk to any patient is disease progression. This is a disease that is intrinsically extremely aggressive with a high propensity for brain metastasis. And given the durability of our effects and especially the CNS coverage, we think that will dwarf any other issues that could be raised. In spite of that, if you look at the tolerability of our drug at a treatment-emergent related adverse event rate of 6.5%, that's almost half of crizotinib, which is considered to be an extremely well-tolerated drug. So we think that -- and the feedback we've gotten from KOLs as well as large health care systems is that they expect for our drug to be preferred. And I think that's what we're going to see. So we feel really good about that. On top of that, while our JCO publication is already out there, and I've been on the road for the last 4 months. And I can tell you that people that we've spoken to are very familiar with that publication. Everyone is well aware of the 46-month PFS in the combined TRUST 1, TRUST 2 studies in JCO. But now that median has not been reached, I mean, that's a great thing. The median is not reached because the drug continues to show incredibly robust durability. And as I said, those patients -- just in our first 15 patients in Phase I, the fact that 20% are still on drug 8 and 9 years out, and that CR, that patient with a CR at 9 years, that patient is going to go on for years more. So we don't even know where the median PFS and DOR will ultimately equilibrate, but it's going to be long. And we think that already our data set are the most compelling of any drug in the space, and we think that, that maturity will further emphasize the durability of this drug, and we think that's very exciting for patients and for physicians.

The next question comes from Soumit Roy from Jones Research.

Congratulations again on the approval. On the approval milestone payment from Sagard, is there any additional color available on the -- is there a breakdown of the $250 million or as a lump sum? And second is the unit price, I don't know if you have disclosed that, it looks like it's coming out to be around $29,000 per month. And the third question is, could you elaborate on the DNA versus RNA-based testing on ROS1, why the RNA base is working better? And is that something you have to develop or a partnership?

Thank you for your question, Soumit. So to come back to the Sagard deal, remember, there are 2 components to that deal. One is the $150 million royalty financing and one is $100 million senior term loan. So all of these components are eligible as soon as we get commercial sales after approval. So -- but the wrinkle in that and maybe the reason for your question is that for the $100 million senior term loan, there is one which is available immediately and one that we can use whenever we want in the next 12 months. So that's why when we've been talking about it, we've been saying $200 million available initially, that will be the $150 million royalty financing plus the $50 million available immediately. That's $200 million. And then we have $50 million more of the debt component that we can use whenever we want in the next 12 months. To come back to the royalty financing, which is a bigger part of all of this, $150 million, remember, it's 5.5% of U.S. sales below $600 million, 3% above $600 million, and there are caps and everything. So we've been saying that if you want to simplify your model, it's about 5% of U.S. sales for $150 million royalty financing, which is like $3 billion, if you want, in terms of sales. So all of this is available -- will be available with our first commercial sales, which are obviously imminent. And this funds our launch, as we've been saying and maybe that's repeated during the call, and it's very -- and it provides us with a lot of flexibility on top of our already very robust balance sheet. So that's for the financing part. To come back to the price part, which was the second part of your question, yes, we said during the call that the WACC -- monthly WACC for the drug will be $29,488. This amount is the fruit of lots of discussions we had with payers. We had more like 50 payers engagement in the last 6 months. So very robust engagement. This is also going to be coming with a very robust support program for patients with reimbursement support, commercial co-pay, preproduct assistance, bridge program, voucher, et cetera, et cetera, all kind of things to make sure that we are both socially responsible, ensuring that patients in the U.S. can have access to this incredible drug and also fiscally responsible to the company and our shareholders and make sure that the launch of Ibtrozi will fund the future of the organization as it should. So that's the two aspects, and that's why we have $29,488.

And Soumit, on your last question about DNA versus RNA, because ROS1 is a gene fusion, RNA finds that a lot easier than DNA. And in fact, it's not something that needs to be developed. It's already been developed and by multiple companies. So virtually every diagnostics company now has an RNA test. Foundation launched their RNA test in May of 2024. So it's already been out for more than a year. They expect it to be standard of care within the next year or two, and everyone else has followed. So this is not something that we're talking about developing. It's already developed. We do think that's going to increase the incidence of loss from diagnosis by about 30%. So from about 3,000 new patients per year to about 4,000 new patients per year. And that's why we think that if you look at that times our current price, that should be about -- and with the revenue stacking just based on about 4-year PFS, that should be about $5.2 billion per year by year 4.

The next question comes from Yaron Werber from TD Cowen.

Congrats. Nice to really see this and even ahead of schedule. Got a couple of questions. Number one, do you have a sense how many patients are currently getting treated in the U.S.? I mean crizotinib probably has the largest share, right, followed by Rozlytrek. So I don't know if you have a little bit of a sense there. And then I have a quick follow-up as well.

So we just look at current sales of the current TKIs times the drug price and divide by drug price, the number of patients on a TKI seems to be somewhere between 1,000 and about 1,500, but recall that the durability of the first 10 TKIs is significantly shorter. So they're coming off therapy fairly quickly because, as you know, entrectinib's PFS is about 16 months. That's one example. On top of that, we know that when we look at the IQVIA data for repotrectinib, about 10% of scripts are being discontinued every month. So about 50% drop out by 5 months, primarily because of the CNS tolerability. So that number, we think, will be very different for a drug that has a much longer PFS. I mean, at 46 months, it's almost triple the entrectinib PFS, and we believe that without even any CNS warnings in our label, that's the main reason for discontinuation of the only second-generation TKI. We think that we will address that readily. And we think that, that will lead to time on drug that just hasn't been seen to date with any ROS1 TKI. And as you know, a prevalence story is far more important than an incidence story for revenue generation, and we think that we're set up for that.

The other point to add, Yaron is that -- I'm sorry, just one second is that everything that David has said about the NCCN guideline and the change, we've already seen the number of scripts for ROS1 TKI increase about 20% in those change, which is a very significant trend and shows everything that we've been saying about NCCN guideline being translated in practice and which is the right thing for patients and that drives the market up, obviously, because this is the right thing to do.

Yes. You also have really good activity in the most common mutation, the G2032R and in general in second line. Any sense of what percentage of patients develop that mutation? I'm thinking about when patients fail the current drugs and then switch.

Yes. So G2032R develops in over 40% of patients. So it's a significant resistance mutation. But what's interesting is that if you look at the G2032R response rate, while Ibtrozi appears to be at the top of the response rate of all the ROS1, it's not dramatically different from repotrectinib, which is a very effective drug. If you look at their published resistance G2032R response rate, still 59%, which is pretty close to where we are. So what's interesting then is that no one has mapped out all the resist mutations for ROS1. And while G2032R is the most common, there are probably a lot of other things that go into patients progressing. And we didn't have it mapped out all those mutations. So that's why PFS is by far the best metric about how good you are at preventing resistance. And we would say that given our 46-month PFS, while we haven't mapped out all the possible resistance pathways, clearly, Ibtrozi is doing something right in that regard. And so we think that G2032R is only a small facet of the multiple potential pathways for development of resistance, but our PFS speaks to Ibtrozi being best-in-class in that regard.

And maybe just last question. So you mentioned you've been enrolling more patients in TRUST-2. Are you done enrolling at this point? And what was the reason for that? Would you then submit that data to FDA?

Yes. This is Kerry. I'll take that question. So we are going to stop enrolling any further in the TRUST 2 cohorts that we currently have open. And the reason why we did continue to enroll is that we needed to provide additional data to the agency during the review with respect to dose optimization. If you'll recall, we had Cohort 5, and that's where we randomized patients to 400 and 600 milligrams QD and provided that data during the review. And obviously, in their assessment, they support 600 milligrams as the appropriate dose. So that was the reason for continuing enrollment, but that's now -- that will now close.

And, I want to raise one other anecdote regarding your question about resistance because drugs can either do something or they can't. And if they can, then you -- obviously, that can be done again and again. We had a very interesting recent case because, as you know, Trust 1 was performed in China conducted in China where the repotrectinib was not available at the time. So we did not have repotrectinib experience in China. We were informed recently just a month ago, of an MD Anderson patient who is 38 years old, diagnosed with ROS lung, really aggressive disease, completely progressed on IO chemo, failed that, went on to entrectinib, failed that, got put on repotrectinib and on repotrectinib developed 23 brain mets. So clearly did not respond to that, was actually going to hospice that got into Cohort 5 of the TRUST 2 study had an incredible response, is now 8 months out, and feels like a normal person, people walking into this visit on repotrectinib is now walking into the clinic and conducting a normal life. So we just think that while that's only an anecdote, drugs can either do something or they can't. And that patient is a different person on Taletrectinib. And that's why we think that this drug -- that's an example of the kind of response we're getting that we think contribute to an unprecedented PFS and DOR that you've seen in the JCO publication.

The next question comes from Silvan Tuerkcan from Citizens.

Congratulations on this great update. I just maybe a more general question about how exactly you're instructing the sales force or what your strategy here is in how to improve testing rates and also the action rates, you just alluded that the NCCN guidelines already led a 20% increase in scripts. How can you further push that up? And how much more room is that on the action on the mutation rate there? And then I have a quick follow-up on the, how many lives covered or how many formularies you are on? And what do you expect the governmental versus commercial coverage split to be here depending on the age?

Yes. So on testing rates, it differs between academic centers and the community. In academic centers, testing rates are nearly 100%. In the community, we think it's about half of that. But that's changing significantly because, as you know, since the advent of precision oncology lung drugs for EGFR, ALK, BRAF and now ROS1, it is literally medical malpractice not to test for precision oncology mutations for which there are drugs that are still effective. And interestingly, if you just look at -- I was at the Oxford Cancer Center in Louisiana, and Louisiana became the first state to have to pass state legislation that now requires NGS testing if you have lung cancer. And I think that's a great development. And I think that hopefully, all states will follow that. But I think it's becoming increasingly recognized that especially for lung cancer, where a disease that used to be considered untreatable, lung cancer has now become one of the most treatable cancers on the planet, especially with EGFR, ALK, BRAF and now ROS1. So I think that testing rates are going to increase significantly. And in the multiple health systems I visited over the last 4 months, we're seeing huge initiatives within those systems to increase physician awareness, speaking about what to do about it with the NCCN guidelines and to mandate ROS1 therapy for ROS1 patients. So I do think that's going to change significantly. Philippe, do you want to?

Yes. So as we've been saying, the typical ROS1 and NSCLC patients is younger than average, about 50 years old, which means that the share of commercial patients will be much higher than in other lung cancer. So we expect more than half of patients to be commercial patients and then probably like about 40% Medicare, some Medicaid and some BADLD. But about more than half will be commercial patients.

Great. And maybe a quick follow-up here. Is there any time line to when the label may be updated specifically to include eventually TRUST 2 duration of response data?

Yes, I'll take that question. So there are going to be kind of two analyses that are ahead of us, and we're working on the kind of the modeling right now. One would be an update to the pretreated population for TRUST 2, which we would anticipate hopefully sometime by the end of this year. And then the others in the TK naive population. And to David's point, we need events in order to reach the median, and that means patients need to progress. And their duration of response has just been remarkably long. So it's difficult for us to have a handle on that right now. But as we get more events, we continue to follow the patients, we'll have a better sense. But at least for the pretreated, we do think that we hopefully will have a label update into the agency by the end of this year.

Congrats again on this great milestone.

The next question comes from Michael Yee at Jefferies.

Congrats on the approval. Fantastic, David. Two questions. One was just thinking about the first year of the launch. I know there will be focus on sales and the success metrics of the launch. Do you expect that this is primarily a blocking and tackling going out there and getting to all of these sites and trying to get all of these first-line patients with ROS1? Or do you think that there will also be people who are swapping and coming off of TKIs just sort of give us a picture of how you think and which types of patients will be coming on in the first year given ROS 1 testing? And then the second question is maybe a bit of a housekeeping, but is this a full approval? I noticed with repo, it's designated secondly as accelerated approval, but yours actually seems pretty broad and doesn't necessarily mention any of that. So I just want to confirm any additional requirements because it does seem quite positive around your approval and indication versus competitors.

Great. So I'll start with the second question first. It is a full approval. So there's nothing else we need to do with that. On your first question, I think that all launches involve a lot of blocking and tackling, no matter what, is as good as any drug is, I think it's always a lot of blocking and tackling. But with regard to swapping, the standard practice in oncology has been you don't swap a patient out until they progress. But we think that there are actually reasons to swap at least some TKIs for Ibtrozi off the bat, which is, if you look at this particular disease where 36% of people who get diagnosed are diagnosed with a brain metastasis and the fact that 50% of people when they do progress, will progress with the brain as the first site of disease progression. This is a disease you need to have CNS coverage and not -- and giving a drug that doesn't have CNS coverage is just not great medical practice. So we think that given the fact that crizotinib, which is the most widely used TKI, doesn't cross the blood-brain barrier, we think it would be inappropriate for physicians to continue crizotinib when Ibtrozi is available. And so we've been speaking to multiple practices and health care systems about this. And while I don't know if it's easy to get oncologists to change their practice in general, it isn't easy. We do think there's, in this particular case, a really strong rationale why they should switch. We do know though that in spite of what practices patterns there are, entrectinib or crizotinib only -- the PFS is only about 1.5 years. So they're going to be coming off therapy in relatively short order, and we know from repotrectinib that the discontinuation rate, especially due to CNS effects is substantial, 10% a month. So those patients will certainly be switched to a more tolerable agent. So we do expect Ibtrozi to be used in switches in those kinds of cases. But we do think that it's important to change practice to make sure that CNS coverage with a really robust durable drug is given right as early as possible, which we think is immediately upon diagnosis. So that's what we're going to be pushing for. But whether or not -- how long it takes to change physician practices always takes some time. But in this particular case, we think the rationale is so clear and we hope that it's accelerated a bit beyond standard switching practices.

There are currently no other questions queued at this time. So I'll turn it back over for closing remarks.

Well, we want to just thank all of you for your support. We're super excited about this launch. We think this is going to be one of the great drugs in oncology. We're so delighted to be able to offer patients with such a devastating disease this kind of durability of response and this kind of tolerability profile. We will keep you updated as new developments occur. We hope to do another data cut sometime later this year. And if we have another intermediate at that point, we'll certainly be updating the label. But given what we're seeing, we have no idea how long it can go on. We think this drug is showing durability that even we did not expect. So all a high-class problem, but we'll keep you updated as we get more data. So thank you so much.