Oncopeptides AB (publ) (ONCO) Earnings Call Transcript & Summary

Hello. And welcome to the Oncopeptides Q1 Report 2020. [Operator Instructions] Today, I'm pleased to present CEO, Jakob Lindberg. Please go ahead with your meeting.

Thank you very much. And a warm welcome to everyone. We're going to go through an update across our studies and what had happened during the quarter a little bit and then, of course, also end with the financials. At the end, we will also allow for questions and answers. So please wait until then, and we'll answer to the best of our ability. So this quarter is all about setting the stage for our submission and for commercialization of [ no ] solution, and that will very much be the backdrop of today's discussion. Please go to Slide #3. So looking at recent highlights for us. This quarter has, of course, been very much in the shadow of the COVID-19 pandemic, where, as we have stated before, we have been on the fortunate end of things. Both our pivotal trials have been affected to a minimum compared to a lot of other companies. And with that, I mean HORIZON and OCEAN. OCEAN, that was fully recruited just recently. We will come back to that. But all the signal-seeking trials have been on pause. We believe that they will be unpaused basically right now. That is in line with what we see other companies doing. And we have had several interactions with the hospitals, the providers as well as key opinion leaders and the regulators to discuss what it's proven to do. And we believe that we are more or less back to normal in terms of clinical study and clinical study conduct in light of the pandemic right now. So we should be able to do that. This, of course, also means that we can continue to try to initiate our new trials that we have planned. Please note that when you pause the initiation, you don't just stop the clock. You need to redo certain elements of your preparations. So we will come back in terms of the time lines for when the planned studies can be initiated at a later date. We got the study results from O-12-M1, our old Phase II study in Lancet Haematology. That was also a big milestone for us. It's a great journal with a high so-called impact factor. And we also got the editorial in that journal, and we're going to come back to that today, which is literally what you wish for when you get your data published because that is the article with the most impact that is then selected by the journal for comment by an independent [ KOS ]. We also presented the top line results from HORIZON, our study that originally wasn't planned to be a pivotal study but ended as a pivotal study, given that the main bulk -- the bulk of the patients in that study belong to what is called the medical need population from a regulatory point of view, and that our results were so strong in that population. So we are now then heading towards the NDA submission, which is the next bullet on this slide. We are on schedule for an end-of-Q2 submission to the FDA. And that -- what we're looking for is to see -- we seek market authorization to use melflufen plus dexamethasone for the treatment of myeloma patients with triple-class refractory disease. Please note that this is what we wish for. We'll see what the regulator tells us in response to our wish. But of course, we have had ample of regulatory interactions over the last year. So this is what we expect, but we have to see. The submission time line for that is then 8 months in total from the time point of submission until according to regulations. This submission should result in market authorization, unless there's a problem with the submission. And the historical average is around 5.5 to 6 months. So that is why we guide that assuming no major problems with this submission, we should have a market authorization at year -- around year-end. That is 6 months after the submission has been sent in. But it could also be early 2021 or it could be slightly earlier as well. So we'll just have to wait and see. The Phase III study OCEAN is fully recruited, 450 patients. We reported that just a few days ago. If you go back in time when COVID-19, the pandemic, hit, we realized that recruitment went down initially, and we gave guidance for that this study will be fully recruited end of April. It ended up roughly 3 weeks later. The key factor that we haven't calculated at that time was that Eastern Europe was fairly unaffected when we went out on the COVID-19 update webcast. And in the end, Eastern -- Central Europe actually has behaved that the hospitals more like Southern Europe and not like Northern Europe, and we haven't estimated that. So that slowed things down a bit further, even though they are quite back on track right now again. But now the study is fully recruited so. Another item that we went out with this quarter was that the HORIZON data set not only validated the activity of melflufen in myeloma, it was also a validation of our peptide-drug conjugate platform, the PDC platform. And we also unveiled the 2 drug candidates that we have in the pipeline, in the preclinical setting, and we gave guidance for when these might be ready for the clinic, and we'll come back to that. And then we have a bonanza of preclinical and clinical abstracts to be presented at various conferences here, which actually marks the highest frequency of scientific publications and communications in the company's history. And that includes then atos [indiscernible] in multiple myeloma now recently, then we have ASCO, we have EHA and we have AACR coming up. So it's a very rich communication environment from us right now from a scientific point of view. And finally, we raised SEK 1.4 billion in directed share issue in May before costs. And this marks actually one of the biggest, if not the biggest directed share issue in the life science sectors in Scandinavia. So it's also a -- apart from being a major milestone pass, it also will enable us to fully launch this drug and take us far into the future in terms of -- and we'll come back to more exact guidance, and Anders will do that, but this has secured the launch phase, at least, of melflufen in the U.S. in terms of finance. Next slide, please, Slide #4. So this is a familiar picture of our clinical study program. I won't go through all the arrows. But as you can see here, we have added 2 arrows at the bottom, and that is the AL-Amyloidosis trial that was paused due to COVID-19 and is about to be unpaused; and then, of course, LIGHTHOUSE, which is our second Phase III trial that should have been initiated around now, but due to COVID-19, we pushed out the initiation. And we'll come back to guidance, but it is unlikely that even if we unpause and can do this, that this will be able to be initiated before the summer. It will most likely be straight out in the summer, but we'll come back with more exact guidance. So what market segments and patient populations do our trials actually address? Please go to Slide #5. So here, you see basically the patient populations in myeloma in the boxes and then the trial that address these patient populations. The -- first, we have the HORIZON trial that where we hope and wish to get a label in triple-class refractory patients. We also have really good results in patients with extramedullary disease and patients with high-risk cytogenetics. To what extent we can get this as part of the label with the FDA, we don't know. We are hopeful, but we don't know. But this is -- all -- both these groups or 3 groups are groups with a significant unmet medical need, where our data is -- the signal is very strong that we're doing different -- making a difference there. So we'll see exactly what the label contains, but it should, at a minimum, contain triple-class refractory patients. Then we have 2 boxes below here, which is the label expansions or the initial market authorizations outside of the U.S. that we're going for. And basically, these are patients that are relapsed/refractory, so they don't need to be triple-class refractory. They could be single-class or double-class refractory patients. So they have started to progress rapidly while on treatment, but they haven't tested all available and approved drugs yet. OCEAN addresses roughly half of these patients, a bit more than that, that only received 1 drug plus steroid. That's the first blue box. And then ANCHOR and LIGHTHOUSE, of course, addresses patients that receive 2 drugs plus steroid. This is -- it very much boils down to local -- how you treat patients locally, what the treatment algorithm is, but also the health status of the patient. If you are a younger, healthier patient, you more -- are much more likely to get the combination, that is 2 drugs plus steroid. If you are an elderly frail patient, i.e., the majority of myeloma patients, the likelihood is that you will be treated with 1 drug plus/minus steroid. To understand a little bit better how this can correspond to market potential, looking at U.S. numbers, please go to Slide #6. So on Slide #6, we have prescription data on various drugs in myeloma for the U.S. until December '19, so December last year. And I want you just to focus on that December '19 time spent, that is the far right of this graph, and look at those lines. Because even though this is a simplistic overview I'm going to give you right now, it gives a very good guidance for how patients actually are treated. The treatment algorithm comes through in these numbers. The first thing you see is that the 2 top lines are Revlimid and Velcade. These are the 2 biggest drugs in myeloma still to this day. One is an imid, the other one has a purpose of inhibitor. And these 2 drugs are what you get as a patient when you're diagnosed with the disease, either you get them one at a time sequentially or you get them in combination. And that is why if you look at the patient numbers to the left of the -- on the y-axis, you see that it's around 50,000 to 60,000 patients per year in the U.S. receiving these drugs. Once these drugs fail you as a patient, i.e., that the disease become resistant to them, you come to the next tier of drugs, which are the 2 blue lines in the middle. One is Darzalex or daratumumab, one is Pomalyst or pomalidomide. These 2 drugs are once again used either together or in sequence. Sometimes together with something else, but these 2 are the main stage of the patients that have started to progress while on therapy. And in this case, on Revlimid and/or Velcade. Now once these 2 drugs, that is Darzalex and Pomalyst, fails you as a patient, you come to the bottom of the chart. And I have said in multiple meetings, I call this the spaghetti of the confetti because it's a mixture of lines, around 10,000 patients per year. And you see multiple drugs here. These are the drugs that are then part of the fundamentally retreatment schedule because the first 4 lines represent all the 3 major classes of drugs focused on inhibitors, IMiDs and anti-CD38 therapy. So the spaghetti of the confetti is the retreatment bucket, where, of course, you try to change the individual drug in each class, but with very poor outcome in general. Now if you were to look at our studies, you can actually see why we have designed our study program the way we have because HORIZON addresses the spaghetti of the confetti at the bottom. And hence, if you are successful with HORIZON, you get approval and you can position your drug in a good way in the treatment landscape. You should get between 5,000 to 12,000 patients, something else like that on treatment on an annual basis from that study in the U.S. Then we go to what we are trying to achieve in OCEAN and LIGHTHOUSE. In OCEAN, we go head-to-head with pomalidomide. That is one of the blue lines in the middle. So we're trying to compare ourselves in a slightly earlier patient population, significantly larger, longer treated. And that is then what OCEAN is trying to do to establish a foothold that also earlier patients should receive [ no solution ]. And here, you also see the reason for LIGHTHOUSE, where we combine ourselves with daratumumab. Once again, it is 1 of the 2 blue lines in the middle. So while we are not with this program addressing the newly diagnosed patients, i.e., the Revlimid and Velcade lines, our 2 Phase III trials are trying to establish a position in earlier relapsed/refractory patients represented by the 2 blue lines on this chart; and HORIZON, of course, at the bottom, the spaghetti of the confetti. So here, you see also the logic behind the design of the program and why we have laid out the study the way we have. So how does these studies turn into patient numbers? Slide #7. Thank you. Here, you see the U.S. patient numbers represented that we think are addressable with the various studies that we have. And you can see here that HORIZON represents -- is represented here by the 2 orange bubbles, both the triple-class refractory patient population as well as the extramedullary disease in high-risk patient populations. Please note, once again, we don't know exactly what we're going to get in the label with regard to EMD and high risk, assuming we get approval. OCEAN addresses then a slightly earlier patient population, with single- and double-class refractory patients represented in blue, roughly 25,000 patients per year in the U.S. in that pool. And then the combination studies in ANCHOR and LIGHTHOUSE addresses the green area, represented -- which is then roughly 20,000 patients that receive combination agents. Like I said, the majority of patients received 1 drug plus steroid, the blue, but it is fairly close, almost 50-50. Now what this picture doesn't contain is the fact that treatment durations vary widely between these areas. So in the orange field, the median treatment duration -- the average treatment duration, sorry, is around 4 to 5 months per patient because so many patients progress very rapidly. So you have patients that will stay on the drug for a year or so. You also have a significant number of patients that progress very rapidly, unfortunately, so 4 to 5 months. Once you go to the blue area, you are more around an average of maybe around 6 months, and then you start to get closer to the year in the green. So that means, of course, that the value from a pure capitalistic point of view is higher, the further to the right of this -- in this figure that you get. The green patients are much more valuable given the duration of treatment since you get paid on a monthly basis than the other areas here. So in terms of market potential, let's go to Slide #8. Thank you. This is -- here, you can see that actually relapsed/refractory patients, when we started this journey, it was actually the smaller market compared to newly diagnosed. Newly diagnosed here is the difference between relapsed/refractory MM and all MM. So it's a roughly $6 billion market. And when we initiated this journey, actually, that was the major part of the market. But the relapsed/refractory segment is the fast-growing segment, and that this $13 billion with the U.S. and rest of the world is, of course, the addressable market for us in terms of our studies. That is the market that we are addressing and hope to get a good share in. Okay. Let's go to Slide #9. I mentioned this that O-12-M1 was published in Lancet Haematology, and we also got the editorial. And I recommend everyone to read the editorial because it really touches the key point of our entire program, thus a modern alkylator had a role in the treatment of multiple myeloma. And we were extremely happy to see this editorial being published. And this editorial was then connected to our old study of O-12-M1. But as I stated, during the quarter, we also reported top line results from our HORIZON trial. Slide #10. Thank you. So our top line data from an investigator assessment point of view was 29% response rate for the overall population and 26% for triple-class refractory. What I can highlight here is actually the independent review committee data. That is what the regulator care about. And the fact that, that data actually slightly improved is due to the quality of our internal work and that the assessments we have done is highly unusual. The independent review committee data is always worse than the data from the company, but it will help us in the regulatory process. And the key question is, of course, how does this compare? Because we are not alone in trying to address this unmet medical need. And therefore, we go to Slide #11. On Slide #11, we benchmark our data from the HORIZON trial. And please note that in this slide, since we haven't released the full data set yet, this is actually the data we presented at ASH, an interim data point. But we see melflufen to the far left, you see selinexor from Karyopharm in the middle, and you see belantamab, which is GlaxoSmithKline's antibody drug conjugate targeting BCMA, to the right. The good thing is that these are very comparable patient populations. And while there are a lot of numbers here, I just would like you to focus on 3 lines in total. The first one is the overall response clinical benefit rate. And if you look at these numbers, I just read them out loud first, 26%, 37%, 25%, 39%, 31%, 34%. They are the same. These 3 drugs are the same. The amount of tumor burden reduction you receive with these drugs are identical. So there, they are not different, even though they represent different treatment classes and modalities. Duration of response, however -- or in other words, for how long is the patient disease-free while on treatment if they respond to it. And here you see that selinexor is at a clear drawback compared to belantamab and melflufen. So at this point in the analysis, selinexor has a minus compared to belantamab, melflufen. But then if you look at the toxicities where melflufen, of course, have hematologic toxicities, but 70% of patients can maintain dose. So it's not a big problem. The nonhematologic toxicity profile of these drugs are very different. And I won't go into details, but as you can see, melflufen's list is very short when you create data in the way that the FDA is doing as a standard in their label text and analysis. While selinexor has a pretty significant list, unfortunately, of metabolic and gastrointestinal side effects, and belantamab has its ocular toxicity blurred vision with some blind patients. So all in all, we think we actually have then the best risk/benefit profile of these 3 drugs. Obviously, what we think is not the important thing. We need to understand what the regulator thinks. But we -- this is why we are sending in the submission because out of these 3 drugs tested in the same patient populations, we feel that we have efficacy in line with belantamab, but with a better safety profile. And selinexor has actually a worse safety profile and worse efficacy profile in our opinion, please note. Slide 12, thank you. So the submission based on this data set is on track for late Q2 release. We are launching an early access program in the U.S. for triple-class refractory myeloma patients. We are right now in the middle of those works, and it should -- we should be able to have a first patient in -- later in the summer. And we are also, of course, in line with sending in the submission. We are building up the U.S. commercialization organization in the U.S. where we had 30 full-time equivalents by the end of March 31, and that is growing rapidly. We are actually on schedule to deliver the plan and the organization there. And Joseph Horvat is doing a great job as our Head of -- President of North America. So that was regarding the submission on HORIZON. Let's spend just a little bit of time on OCEAN on Slide #13. So as you know, it was now fully recruited, and it's a head-to-head comparison with pomalidomide, i.e., we are addressing the middle segment of the market chart that we discussed before with this trial. It's a trial where we -- the null hypothesis, as it's called, is that we are superior to pomalidomide, but we can also meet the endpoint if we are non-inferior to pomalidomide. So we have 2 different results that both would mean that the study was a successful study. Of course, we hope and believe that superiority is the result. Right now, what happens now? Right now, we are waiting to receive the right number of events from this trial. We need a certain number of events to do the statistical analysis, and we don't control when those events happen. Because in the event is that the patient relapses in his or her disease, that is that the tumor is growing again, and we just need to get the data from the various hospitals. And as a paradox, the longer it takes for that to happen, the better it is because that means that something is going on in the study that is positive. We, of course, don't know which arm, but since we basically know how pomalidomide performs, any delay in getting the events should mean a good probability that this is due to our drug. But we don't know that until we have looked at the results, of course. So we are following this very closely right now. And we have given guidance that originally, this was due to end of Q3. And as you know, we said when the COVID-19 hit, that a slight delay in finishing the trial should also translate to that time point. So now we are just saying second half of this year in the news flow. The key assumption for this trial is that pomalidomide and the system molecule, lenalidomide, that they have cross resistance. Please go to Slide #14. There has actually been some discussions regarding this. And I would argue that right now, everyone is in agreement that there is a significance degree of cross resistance between these 2 drugs, and that is what makes this head-to-head trial actually trial with a good chance of success rather than a low probability of success. And on this slide, you see that the model of data set showing that pomalidomide loses between 25% and 50% of its activity. There are 2 other studies showing exactly the same thing. One is a study by David Siegel that was recently published in British Journal of Haematology, and the last data set is the optimism trial from Celgene. Celgene has tried to position both of the later 2 trials as trials where it shows that pomalidomide works, even though the data suggests the complete opposite. So we're very happy that they talked about it. But there are 3 big data sets saying the same thing, all roads later on 25% to 50% reduction in pomalidomide activity in recently, say, lenalidomide-fail patients. Early on, I talked about our platform, and I just want to briefly go through that, Slide #15. The platform is -- we call it a peptide-drug conjugate platform. We put a very small B-peptide to a toxic payload that has 2 specific enzymatic motif that actually results in an increase in antitumoral activity. There are a lot of things around these motifs that we don't fully understand to this day, as is the truth with many other drugs as well out there. What we can say is it doesn't just deliver a payload. It actually changes the molecular fingerprint of how the drug works. We don't utilize, for example, as an alkylator now with melflufen. We don't even utilize the same alkylator pathways at better alkylators. So we fundamentally behave as a novel class. So looking at the activity footprint from this platform on Slide 16. So Slide 16. Thank you. You can see that across a broad range of tumors, this platform has activity. There are some where the activity is lower, such as renal and colorectal cancer that you see to the far right on this chart. But otherwise, it -- these sensormatic motifs seem to be key for the majority of cancers out there, which means, of course, that the indication broadening from this platform outside of myeloma is one of the key strategic tasks we have in 2021 and beyond. Where are -- there must be more patients than in myeloma that would benefit from a drug such as melflufen for one of the following compounds. And looking at the follow-on compounds on Slide #17. Of course, melflufen is the one that is -- furthers ahead with the submission now. But we also have 2 compounds that we have revealed, and that is OPD5 and OPS2. OPD5 is a compound where we have designed it to be utilized in conjunction with the stem cell transplant, that is a bone marrow transplant in primarily hematologic malignancies; and then OPS2 is a peptide-drug conjugate with a slightly different profile than melflufen. And of course, we will look carefully at the data for OPS2, and we will come back to exactly which indications we will go with that 1 and 2. But in general, OPD5 will be ready for clinical use in 2021 and OPS2, late 2021. So when I'm saying OPD5 ready for the clinic in 2020 in this chart, that means they have all the data, but then you actually need to create the documentation for the regulator, et cetera. So realistically, clinical trial can't start with OPD5 until early 2021. So going into the financing, and I think, Anders, you should take this part from Slide #18 onwards.

Thank you. Yes, we're very happy that we were able to execute a very successful directed share issue that we announced on May 5. We saw very high interest, and it was a little bit a nervous process since the markets have been globally over time. So we were very happy that we were able to generate such high interest. The issue was roughly 4x oversubscribed. So we were able to upsize it to the maximum size rating roughly $144 million or SEK 1.4 billion. We were particularly happy to see that for the first time, we really saw a wide range of U.S. specialist investors coming in. And we mentioned in the press release that we received Deerfield, Farallon, Artisan and Octagon as new shareholders. We're very happy to welcome them. But of course, we're also very happy that we continue to get very strong support from our existing shareholder base. Without them, we wouldn't be here today. So a big thank you to all of the shareholders, and thank you for your confidence in us. Let's then turn to Slide #19 for the financial results. As you can see, the operating loss increased from roughly SEK 134 million to SEK 297 million. And on the left-hand side, you see the graph showing why it's increasing. And basically, the R&D costs are increasing significantly, going from SEK 107 million to SEK 214 million. The lion share of that is explained by increasing clinical costs. We have clinical and drug supply increasing to SEK 158 million in the first quarter from SEK 73 million last year. For example, the cost for the OCEAN study went up from SEK 37.6 million to SEK 77.7 million. And you should note that a big part of that is a large purchase of Pomalyst for roughly SEK 32 million in the quarter. So the cost for the OCEAN trials are quite lumpy since we buy Pomalyst from time to time. And then, of course, we're up for that quarter. It doesn't mean that it will always remain on that level. We also saw a big increase in the HORIZON study going from SEK 11 million to SEK 26 million. It has become a pivotal trial. That was not what it was designed for from the beginning. So the costs have gone up quite significantly. For the first time, we also include cost for the LIGHTHOUSE study. We have selected a CRO and have started to prepare the study. So we will continue to incur significant costs for that study. The costs for the ANCHOR study has actually gone down, mainly explained that we did purchase a lot of drugs in the first quarter last year but not this year. You also see from the graph on the left-hand side that the marketing and sales costs have gone up from SEK 17.9 million to SEK 51 million. This is, of course, explained by the buildup of the commercial organization in the U.S. The full cost for the U.S. subsidiary was SEK 44 million in this quarter, going up from SEK 8.5 million last year. However, not all of those costs are recorded in sales and marketing, so we have roughly SEK 14 million included in G&A of the cost for the new subsidiary, and that explains the increase in cost for G&A. Cash flow was SEK 313 million negative, which is in line with the operating loss. We also have some changes in working capital that explain the difference between cash flow and the operating loss. And then at the end of the quarter, the cash position was SEK 617.8 million. That then does not include the financing, the pro forma number, if the financing would have been performed before March 31. But then, we would have had SEK 1.95 billion in cash. And with that cash amount, we have runway through Q2 2021. So we now financed to perform the launch and all the clinical programs that we want to perform during that period as well. So we're very well financed right now. You should also maybe note that the settlement of the financing will be carried out in 2 steps. We issued 6.1 million shares already made, but the second part of the share issue will be executed in July. So the number of shares will increase by 6.2 million shares in July as well. That was all on the finance side, and I'll leave the word back to Jakob.

Go to Slide #20. Thank you. So just with regard to news flow. On this slide, you see the news flow divided in 2 buckets. The upper bucket is the news flow that is added, and I'll come to that; the lower bucket is the news flow as it looked before COVID-19, and then we paused the signal-seeking trials. As I stated earlier, we now believe that we will unpause them within a very short time period, meaning that we will come back with updated news flow time lines for these studies at a later date. Right now, before we have unpaused, we can have our full arms around the situation in regards to the type of patient recruitment, et cetera, we will see. We don't want to give any guidance. But obviously, the 5 boxes on the lower half of this slide will move to the right. By -- and the question is, is it just 1 quarter or 2 quarters? And we don't know that yet. Looking at the upper half. We have the last patient in an OCEAN. We delivered that. The NDA submission remains, but we remain on target for a late Q2 submission to the FDA. We now have top line results. We have put that. As you know, in the report, we wrote second half of this year. The original guidance was late summer, August, September time frame, but that was before COVID-19. And we finalized the study roughly 7 weeks later than end of March, meaning that something like that is reasonable to assume at least that it's added, meaning that we bumped this into Q4 -- early Q4. The main risk here, though, is that we don't control the events. And as I said, if the events take longer time, it's actually positive for us, but we just have to wait and see. We don't control that. So there's still uncertainty exactly when we will have top line results. We, of course, have the potential to accelerate approval in the U.S. As we said, the historical average is 5 to 6 months, which would put it at the end of the year. But there is a process ongoing to the regulator from time of submission up to 8 months, which would put that also potentially in Q1 in 2021. And then the potential launch is, of course, at the same time as the potential accelerated approval. They are very closely aligned in time, just basically a day or so in between. Thank you very much. I leave the floor open to potential questions from me or Anders -- to me or Anders.

[Operator Instructions] Our first question comes from the line of Christopher Uhde from SEB.

Jakob and Anders, congratulations on the enrollment. Obviously, a big news. So my first question, just on the timing of filing. So Karyopharm, they've submitted their SNDA. Obviously, selinexor is not standard of care. So there's no question of that being an issue, right, for -- in terms of getting a conditional approval? That's the first question. Then you mentioned the slide -- on one of the slides here, ANCHOR being -- potentially getting you being part of how you get to combo use on the label. Do you expect ANCHOR to be sufficient to get there and bortezomib combinatorial use on the label? And yes, I think I'll just start there.

So thank you, Christopher. So basically, selinexor is not part of standard of care. So for the submission and filing, this is not an issue. This would potentially become an issue if we -- if the submission was significantly delayed from us because then, they could get their full approval and all that before they had time to submit. And that could actually shape the landscape. But now we are on target, and they will not have any type of approval 2 to 3 weeks from now, 4 weeks from now. So right now, it is not. No. As to your second question, no, ANCHOR will not result in any label language at all. And I know that regulators hate to hear this, but roughly half the combinations in myeloma are so-called medical-use combinations, that is combinations not formally approved. And that is based on Phase II data. So ANCHOR, of course, can result in some physicians. We don't have the right to promote or push it, obviously. But especially in later lines, there's a lot of pick and mix going on. And then Phase II data actually matters in that. And for that, ANCHOR can do something. But obviously, with LIGHTHOUSE, we are seeking the formal label expansion into having a combination.

Great. That's fair enough. Yes. Then just on -- so R&D costs. Well, so ANCHOR and BRIDGE. I guess, you've said that the cost for ANCHOR went down, but they're cited as factors behind the higher R&D costs. Obviously, they've been on pause since, I guess, March, right? So what's the current status in terms of N? And when do you think you might -- I mean, what are the factors, let's say, that might -- that would trigger you to press play?

Yes. You mean on forcing the studies? I mean, so we have had both AdBoards and KOL interactions and interactions with local authorities regarding this. And our opinion is that actually, in cancer right now, it all boils down to safety, right? Like you don't want to impose safety issues on patients. What all the KOLs, all the local regulators say now, and I'm sure you have seen similar articles in Sweden and other countries as well, is that the biggest safety issue right now is that cancer patients are not getting the care they need for their disease, i.e., under-treated cancer is a bigger health risk for these patients than the COVID-19 exposure, meaning that right now, all these institutions are pushing hard to restart and make sure that patients come to the hospitals, that patients come to receive their treatments and that patients with potential cancers seek help to see if they have a cancer. And this is actually a bigger problem than COVID-19 for this patient group right now. And of course, in that context, it means that we have an ethical obligation to unpause our trials because the problem is the opposite from where it was 2 months ago.

Yes. So I guess, like the -- and the consensus on COVID, I mean, to the extent that there is one, would be basically that one should probably expect a second wave starting in autumn. Does that -- how -- if the second wave comes, how would that affect things, which, I mean, I guess you'd paused recruitment again, but is that -- is -- are considerations about that a factor that goes into whether or not you're thinking about restarting or -- yes, pressing to play...

I mean, actually, right now, I would argue now when it's so much easier once you start to have -- we know roughly the data from the first wave, right? And what we can see is that actually, that several patients group not receiving adequate treatment is as a big problem as COVID-19, and this goes for cancer patients and cardiovascular patients in particular. And I think that when a second wave comes, these patient groups with severe illnesses will actually be prioritized, and they will really fight to maintain treatment algorithms, hospital visits, et cetera. Of course, you don't want to do hospital visits unnecessarily, but to maintain treatment and maintain diagnostics on these patients will be key to actually get a good epidemiological outcome from the whole COVID-19 situation. So the short answer is I don't believe the second wave will close our trials actually.

Okay. Great. And just last one before I get back in the queue. For Anders here, how should we think about R&D costs over the remainder of the year? I mean, should we expect the highest in Q4 to be -- due to OCEAN?

In Q4? No. I think you should expect them to be fairly stable during the year.

And the next question comes from the line of Patrik Ling from DNB Markets.

Yes. Just a follow-up question to Christopher's question here before when it comes to selinexor and the SNDA. The answer today that you gave, Jakob, it sounded a little bit like you just have to file before they get an approval. Previously, you've said that you actually need to have your approval before they have their approval. Maybe you can just clarify what the rules are really to be sure that your drug gets approved.

Yes, absolutely. So technically, the answer I gave before is the correct one, which is exactly what you reiterated now. We need our approval before they get their approval. But in practice, the submission and filing becomes key because the FDA has an obligation to maximize choice for patients. And it means that if they sit with 2 files on their table at the same time, they will determine -- and they determine that melflufen is a drug that should get accelerated approval based on their data, they actually will and will have to basically approve that first and then take selinexor straight afterwards, even if it's just a day in between. So that means that actually, the submission date becomes kind of important to make sure that they sit on all the data and can make their assessments before they come to a time point when they need to approve selinexor. So in the -- according to the Boston trial. So from a practical point of view, actually, the submission becomes kind of important here in terms of time. But from a regulatory point of view, it's absolutely the approval that determines everything.

Okay. Great. Then also on the second follow-up when it comes to the OCEAN trial and the LIGHTHOUSE. I mean now when OCEAN is fully recruited, then I mean the pickup in cost that we saw was due to buying a lot of Pomalyst. Maybe you can elaborate a little bit how these costs will play out going forward and when you have to buy more Pomalyst at some point. And then when it comes to the LIGHTHOUSE trial, I mean now you started to initiate that trial. I mean what should we expect overall for the cost for that trial, given that in this case, you don't have to buy the daratumumab drug? I mean, if we compare LIGHTHOUSE to the OCEAN trial.

Anders?

Yes. So LIGHTHOUSE will be much cheaper trial. It's much smaller. I think -- what's the latest patient number? It's 170 or something.

Yes. Yes. That's sort of 200 patients.

Yes. So it's much smaller, and we will not have to buy the comparator drug. So it will, of course, incur costs, and that will ramp up during the year, but it will not be sort of at full pace until we have a lot of patients included. So the highest cost for that trial will probably be during 2021 and not in 2020. And at the same time, the OCEAN costs will continue, but they will start to go down, especially from the first quarter since we have a big chunk of Pomalyst that we have to buy. So I think those 2 combined will be roughly stable over the next year or so. Does that make sense?

Yes. Okay. Great.

Thank you.

And the next question comes from the line of Peter Welford from Jefferies.

Just 2 quick questions, please. And firstly, just with regards to the U.S. commercial infrastructure. You said you've got 30 FTEs by the end of March with a ramp-up plan over the future quarters. I wonder if you could give us some sort of, I guess, plans as to what sort of FTEs you should be thinking about over the coming quarters. And then by the end of the year, should we anticipate the commercial infrastructure in the U.S. to be more or less fully in place in the first phase? Or is any of the hiring and plans being held back until the approval is actually given by FDA? And then secondly, just on to the HORIZON final data set. Will you -- will there also be an update on the duration of response? Or should we expect that more or less unchanged from the prior presentations?

Sorry, what was -- I didn't get the last question, Peter, can you...

Sorry. You're right on duration of response. So I very appreciate the final data set. You've updated the overall response rate and given us the IRC data on that. With regards to duration of response, should we assume that more or less unchanged? Or what's an update on the mDOR as well for those analyses?

Yes. Okay. Thank you. So in terms of the ramp-up of the commercial infrastructure, we will -- right now, we're actually doing some analysis for the final numbers in Q4, and that has mainly to do with COVID-19 because you're not allowed to visit hospitals in the same way as before, which means that a lot of the interactions between a sales rep and a chemist is actually down in the virtual environment now. So that might have implications for the exact FTE mix we want at the time of launch. But to give you a rough number, we will be around 100 people in Q4 just before the launch and then in the U.S. And then exactly where that will end up as the final number, we'll have to come back to that and give guidance. But the current plan is actually to be, for example, 81 at the end of Q3 and then with a continued ramp-up in Q4 in line -- just before the launch. When it comes to the DOR, it will be updated as well. So we will update all the time-to-event parameters. What I can tell you is that we feel very comfortable with the time period that the patient is actually from the initiation of no solution treatment until the patient progresses in that data set. We feel very good. We have a slightly longer time to respond than other drugs. But if you look at the actual -- the T3 period that these patients have, it looks really, really good.

[Operator Instructions] We have a follow-up question from the line of Christopher Uhde from SEB.

My question was just answered, so I'll -- I'm covered. Thanks a lot.

Thanks, Christopher. No problem.

And as there are no further questions, I will hand it back to the speakers.

So thank you very much, everyone. And do not hesitate to contact myself, Anders or our IR department should any more questions arise. And otherwise, we'll keep in contact over the coming quarters. And thank you so much for joining this call. Thank you.

This now concludes our conference call. Thank you all for attending. You may now disconnect your lines.