PTC Therapeutics, Inc. ($PTCT)

Welcome to our next session. We've got PTC Therapeutics presenting for the next 30 minutes sitting up here on stage with me are a couple of folks that you definitely would recognize Matt Klein, who is, of course, Chief Executive Officer; as well as Pierre Gravier who is Chief Financial Officer; also have a couple of folks in the audience from the team as well. We might get out to Eric during Q&A as well. So let's maybe just do a quick overview of the company for the few people who might not know about PTC not, and then we can go into Q&A.

Absolutely. Thank you so much for having us, Tazeen. PTC is a global biopharmaceutical company that discovers, develops and commercializes therapies for diseases of high unmet need. We have 6 marketed products that we commercialize ourselves around the globe as well as a robust R&D portfolio, including our validated and differentiated small molecule oral splicing platform. We're off to a great start in 2026. We delivered commercial revenue -- total revenue in the first quarter of $273 million with product revenue of $226 million, allowing us to raise guidance for the year. That was really led by our another strong quarter for Sephience, which we launched last year for children adults we did $125 million in revenue globally. This is a rare disease launch that's leveraging our established global infrastructure. And as I mentioned, we're off to a strong start with strong momentum, and I'm sure we'll talk a lot about that during the fireside and also, we've made a number of advances in our R&D portfolio as well, sharing the positive data from the long-term extension of our oral Huntington's disease therapy votoplam, which is partnered with Novartis. We also shared that Novartis has initiated the Phase III HD trial, which is up and running. We also provided an update on our Friedreich ataxia program, where we've discussed with being able to conduct an open-label versus natural history study to support NDA resubmission and our NLRP3 program we shared is now in Phase I. So a lot of great progress across both the commercial and R&D portfolios.

Okay. Great. So yes, we wanted to talk a little bit about this new little launch you've got with Sephience, right? So we've covered this company. I've covered this company for quite some time now. So you've had an evolution. So you were originally known as the DMD company. And now you've got PKU and maybe just talk to us about the platform, how it's evolved and why you're excited about the early innings of the launch, and then we can talk about what your expectations going forward are.

Absolutely. So the company has its roots in DMD, which was started with DMD and actually being one of the first RNA drugs in development. And that experience with Translarna and then, of course, with Emflaza really allowed us to build a robust rare disease global commercial infrastructure with the ability to navigate regulatory authorities, pricing and reimbursement and sales all over the globe. And so as we've continued to do work and focus on both the discovery and development of important therapies for rare diseases, PK, the PKU program with Sephience fit very nicely into that. And of course, we have a number of other programs in the pipeline that are moving through. And so when it came time to file for supine and get ready to launch. This was really -- we saw it as an exciting opportunity. One, because the molecule, the therapy itself tuffs highly differentiated has a novel dual mechanism of action, which is capable of providing potential benefit to the full spectrum of PKU patients approximately 17,000 individuals in the U.S., 58,000 globally in areas we can market the therapy. And despite their being approved therapies, there remains a significant unmet need for the vast majority of patients. So here we are with the opportunity to launch a product that has a highly differentiated profile, very strong safety profile, demonstrated efficacy across the full structure of patients regulatory labels that are quite broad, a large patient population for rare diseases with significant unmet need and this global team that's very used to launching and selling rare disease drugs. So we've been able to, within 6 months, get approval in the U.S., Europe and Japan. We have already launched in a number of countries, we said we should be in up to 30 by the end of this year. That's really impressive for a company our size and for a rare disease launch. So I think it's really this combination of having a really good drug a really experienced team that obviously being in place allowed us to spend 1.5 years in market development, become very well integrated in the patient communities, understand their needs, have disease awareness and education programs like in the U.S., we had an opt-in program priority to launch all these things that allowed us to hit the ground running as soon as we had an authorization and I think you're seeing the products of that with the strong launch not only in the U.S. but now globally.

Yes. So on the point of the strength of the launch, were you expecting a bolus when you first launched? And did you see that? And is that starting to fade?

Yes. So I think the term bolus to me so the short answer is we don't think we had a bolus because a bolus really means you had this lot of patients come in and then it dwindles off. What we certainly had was an acceleration phase in the first couple of months where since we had done so much work in market development and there were a lot of centers that had waiting list of patients to come in, we had a really strong start to the launch. And -- but we're still in a period of very strong momentum that we can maintain for the long term. So that's why we've really used from an acceleration phase where in the first few months, they're waiting list, the centers brought in a lot of patients and then somewhere around middle of the fourth quarter, we started seeing we're getting into this sort of sustained cadence whereas patients came in there being put on drug. We also noticed that there are a lot of things in this launch that I think people misunderstood coming into it. One is, I think there's a fundamental misunderstanding of the marketplace. A lot of folks thought that, well, we had 17,000 patients, but a lot of patients are lost to follow-up and you'll never get them in and maybe you'll just get to patients who are on existing therapy switching. And that's not what we observed at all. In fact, what we saw across the centers of excellence is that there's a preference for getting those who are not on therapy on a therapy first. And a number of these individuals who thought to be lost to follow-up such as adults, including those with classical or more severe form of the disease, they're coming back to the clinic. And so I think what we've been able to show early on is that the addressable market is the full patient population of PKU. These are people who want a therapy so long as it's safe, well tolerated and it can make a difference in their life. And so we've been able to really Again, a lot of this was from the work we did before, but we're already penetrated into over 90% of the centers of excellence in the U.S. Again, this early in the launch is pretty phenomenal, and we have penetration into all of the key patient segments, including those therapy naive, those who tried and failed other therapies, those who are switching from existing therapies. We've got infants on the drug. We have an 80-year olds on the drug. So we -- the breadth is really the story of this launch, and it's the fact that we have that breadth already no matter how you segment the population and the fact that the population is so large, what gives us the confidence that we're really in this period of sustained momentum in the U.S. And then outside the U.S., we're just getting started, right? So we've launched in Germany, and that's going very well. We launched in Japan in March. And now we're seeing that sort of accelerated phase in these other countries. And that's what's so special is that we are now in a period with a strong start in the U.S., a strong base of patients with sustained momentum there and now accelerated momentum globally is really what we believe is going to take us to the levels that we think we could achieve blockbuster status, multibillion dollar status as we've talked about.

Okay. So we are in agreement with everything that you've said. We published a survey of physicians before you reported the quarter, which indicated strength in the quarter and beyond. But some have been -- some folks are looking at data points that we'd like to hear what you think of, for example, claims data. So some are of the view that claims data trends seem to indicate that there might be a plateauing of demand. So why would that be an incorrect interpretation?

Yes. I don't think the claims data really reliable here for us. And then also people are looking at prescription sources and we have 2 specialty pharmacies to close network, everything is confidential. So that's point one. And point two, is that what we talked a lot about is we saw at the end of the year holidays into early part of the year, typical dynamics you'd see with holidays and starts may be going down a bit. and then shorter month in February. And then we see a really, really strong March, really strong April, and there's no signs that this momentum is slowing. Yes, it's every week is not going to be the same. It never is in any launch, there's a lot of external factors, but if you can zoom out and look from around mid-November until now, it's pretty consistent. -- the number we gave. So I think people -- I know there's a lot of discussion about the first question was there this bolus and now it's going wait there was this acceleration from all of the work we did market preparation we did. And now what we're seeing over the past 4 or 5 months is sustained momentum that all the signals we have are going to continue.

So you've used Sephience a couple of times in this conversation. You used it a couple of times on the earnings call. So as far as U.S. and then we'll talk about ex U.S. in a second, is this -- are you in a place where you think you'd start to feel comfortable providing like sales guidance?

Yes. So I think what we've talked about is we've typically had the practice of not giving guidance for the first year of a long and we've said that we see -- we believe we're in a period of sustained, which means if things continue to go the way we imagine as we get later into 26 across the year point, and we have enough points on the map to give guidance, then we'd be ready to do it. No promises of exactly when, but obviously, we're tracking this. It's we're seeing such great trends, such strong trends, and we're still early launch. So we want to make sure as always when we give guidance, we believe in the guidance and can stick by it, but there is -- and I think we've been very clear, everything we're seeing reaffirms our conviction in this -- on the strength of the launch and really the strength of the long-term opportunity here for the product.

So you talked about long-term opportunities. So I don't know what the current consensus estimate is for peak sales. But as you look at number of patients in the U.S. and abroad, how are you thinking about what the TAM worldwide could be on sales here?

Yes. So we said that the market itself, we think is about 58,000. We've not guided to what that could translate into sales. Obviously, the price, there'll be some variation outside the U.S. We're working very hard early on to maintain, as always, that rigid pricing corridor. We shared that we've got pricing in Japan on par with the U.S. WACC that's fixed for 10 years. really good and making very good progress there. Similarly, we have the list price in Germany is on par with the U.S. So again, we see at 58,000. We said about 17,000 in the U.S. And we -- again, just where as we see this going, we've already in the first -- through the first quarter, have over 1,200 patients on drug and we'd see an ability just to continue to build that base. And that's really the key with good adherence and steady ads and accelerating is at the outside of the U.S., that's how you get to that large opportunity.

What has early discontinuation rates look like? And I think I asked this on the earnings call, but maybe we can go into a little bit more color. What's been the reason for discontinuation.

Yes. So we said we're a little about the low double-digit percentage, which is really strong at this point. in the launch, especially when you consider what I said earlier, which is a lot of the early prescriptions in the U.S. were for those who are therapy, i.e. have classical PKU, the more challenging patients. So if we're seeing really good adherence to the more challenging patients, knowing that a lot of the Kuvan switches, for example, is still to come, that gives us a lot of confidence in the long term adherence rate because definitionally, if you've been on an oral therapy for years and whether it's branded or generic, and you're going to switch to a therapy that's also once a day, let's just say, has equivalent tolerance, but superior efficacy, that bodes really well for the long-term adherence there. In terms of reasons for discontinuation, we have -- about half of them have been for clinical, which could be not effective or tolerability. Other is a patient preference. We've seen the number that are patient preference, which falls into any number of buckets so.

Is there a particular profile of patient as this launch is progressing that you think would be particularly likely to respond? Or is it too early to know?

Well, look, I think we've said what we're seeing is response across the full spectrum, which is what's really, really important. Again, the fact that we keep hearing stories of prescribers who put their most challenging patients on and hearing about phenomenal responses in terms of not only phenylalanine lowering, but it liberalization -- of course, we know from our data that any individual who's had any response to Kuvan brand that a generic will have a superior response to supply. So that's very clear. Even if they were able to get to target fee some diet liberalization one would fully expect that to be much better on Sephience. So the good news is the word out there in the -- the experience in the real world is that we are having meaningful effect across the full spectrum of disease, which again continues to give us confidence to continue to penetrate these markets, right? If you're a prescriber and you put your challenge in patients on the drug and you're seeing responses that just says, "I'm going to keep going there. And then also, I have got these other patients that I can switch at some point just when you look at that across the board, you say, okay, that's why this has really long legs and a really large opportunity potential.

So in terms of treatment-naive patients who are experiencing suffice for the first time versus switch patients from something else or as you described it earlier, patients who were initially lost the therapy and are coming back in. What do you think is the current of that.

So right now, we have somewhere around 30% of treatment naive, which is a nice number. And then the switches and the try to fail. It's a little harder to ascertain the exact numbers because it's not always clear if you've tried before, TSFs always distinguished between the 2. But I think let's call it an even -- maybe -- actually, I think we have more tried and failed than on current therapies. Again, because what we've heard is this desire to try patients on -- who aren't on an existing therapy which is why we believe we still have a very long way to go in terms of Kuvan switches.

Okay. And from the time a script is written to when a patient receives treatment, how is that time period contracted as the launches progress.

Well, I think it started very strong. I think we were on average of when we started, we're probably still in that average range.

Do you expect that to be the normal range.

I think so. That's an average. Some can get on very quickly and some may take a little longer depending on their specific circumstances. And now we said we now have policies with over 2/3 of American lives. The policies have been consistent in being very flexible with very few obstacles to getting on therapy. So all of that, we think, is going to continue to help.

Now what are you hearing about the qualitative measures like the quality of life measures like diet liberalization and things of that nature, which we had talked about prelaunch.

Yes. We're hearing great things. And we're seeing great things. In fact, on social media, it's so fun to see stories of kids eating certain foods for the first time we saw photo of a kid eating a piece of stake of as parents grill and never having been able to do that before and hearing stories of families all being able to have the same yield for the first time. We're also hearing a lot about benefits on cognition and mood which is super interesting because if you talk to families affected by PKU or health care providers, they'll talk a lot about the burden of anxiety, brain fog and cognitive difficulties. And we -- in our recent publication looking at the open-label extension from the Phase III study, we're showing on the QL measures that we're having a good impact a very favorable impact on anxiety, mood, other aspects of mood and cognition. And these are things that go a long way for patients and feeling better -- in fact, when we talk about the policies, the criteria for reauthorization include quantitative things like fee lowering, potentially diet liberalization but also overall medical benefit. And we're hearing from a number of folks that I don't know, my numbers are a little bit better, but I just feel so much better. My brain fog is gone. And that's really important because that's talk about quality of life, being able to we had the story of us have to take a new set to use GPS to get home from work, right? To be able to not have to do that, move being better. All those are really important favorable effects of the drug.

And as you talk to physicians, is there one thing in particular that they are impressed by? And I'm sort of trying to figure out sort of the depth of prescriptions. So are you still at the phase where doctors are trying it on a couple of patients and you keep getting new doctors that are adding a couple of patients? Or are you seeing more trying to use it in a more significant.

Yes. Great. I think again, we're in over 90% of the centers and these are the larger centers, and we look we've been in contact with the other centers and fully expect to get them on board. Those are the late adopters as you typically have seen the launch. But I think we've seen a variety. We definitely the larger centers, what we're seeing is we're putting one on just like we said we would. We're going to try all our patients on it. We've seen other centers that were maybe at first were a little skeptical, and I'm going to try 1 or 2 more difficult patients and then they started to response. Okay, now the flood gate is open, and we're going to try to put everyone on. I think it's so those early -- that early experience in the more severe patients was so important to reaffirm that all patients should have the right to drive this drug. It becomes the first line therapy for PKU. And that's where we're going. And we're there in a lot of the major centers and again, that's what gives us the confidence of the durability use words stand to gain the -- of the launch momentum. Yes.

Okay. And then as it relates to Europe, do physicians there have a similar view of suffice to how U.S. physicians think about it? I mean you guys have been an unusual position of being able to market drugs in Europe for longer than you have in the U.S., you have that built-in expertise. So did you -- were you able to -- have you been able to capitalize on the infrastructure you've built out for Translarna for this launch in Europe?

Yes, absolutely. We have that playbook for Europe. We have it for LatAm with the approval in Brazil, and we're or using a similar playbook that we're writing for the first time in Japan. And the experience in Europe and Japan are actually quite similar to what we're seeing in the U.S., right? Great enthusiasm on the part of the KOLs and understanding of the potential of the drug to treat the full spectrum of patients. It may differ center by center who may try first and how that works, but a lot of excitement. And we also using that infrastructure we had in the Translarna playbook, we knew a lot about how do we leverage early access programs. in a number of European countries, which we're doing, while pricing and reimbursement goes on. So that gives us the ability to sell the drug at the price that's consistent with the -- what we're maintaining for the narrow corridor, all while we're going through the period of formal pricing and reimbursement and to be clear, these are on the access plans, you're not going to get all the patients on it. It's going to be smaller numbers once we get final pricing reimbursement set, then you look like the large numbers to come in, but it allows us to one, start getting revenue in the country; and two, building up the physician and patient experience in those countries in a very positive way. So that one's pricing and reimbursement are in place. again, it opens that fury and allows us to access the larger patient pools in all of these countries.

For Germany, in particular, I think for some launches when they've gone particularly well, they've had to go back and take a price decrease. So what is your expectation of that happening? Yes, so launch?

Well, so Germany now has -- it's a 6-month repricing can that came to an end for us in January. We launched in July, and we're in the process now of going through the pricing negotiations. The initial assessments were quite favorable. A lot of that is because of the data we have, the fact that we had done a head-to-head study our AMPLIFY study, which showed that on average, patients had a 70% greater lowering in phenylalanine versus Kuvan. That head-to-head data was super, super valuable. We saw them what they don't often do, but did in our case was recognize the biomarker fee being meaningful and having tap. So that's going very well. we expect there will be some discount. What it is, we'll know better as we play out in terms of rotation.

Okay. You mentioned phenylalanine. In the U.S., are doctors actually going back and measuring these levels in real time.

Yes, I think they do measure them. I think it's -- patients want -- well, the funny thing is if an individual TK will tell you that their brain is like a PKU finally mode. They know in their levels are high and levels are low. But the physicians do look at it and they do monitor it. And the patients do it. I mean we've seen on social media, people posting their fee results, down 80%, and which is really, really cool.

So that's another motivator for patients to stay on therapy, do you think.

Absolutely. We -- and the way it works typically is you need to get to a certain level before technically, you should be liberalizing the diet. Yes. And one of the things we've done in this launch again our experience in working with centers and prelaunch, making sure we understood the dynamics at each of the centers of excellence is the important role of the dietitian, right? The last thing we want -- we're sitting here in Las Vegas. Last we want someone to start on the drug and rent to the buffet and started eating everything, right? You want it to be a very thoughtful measured approach. And so we've been working a lot with the centers and they've been working a lot with those who get on the drug to have a very measured approach to first establishing that you're having a certain mentality then gradually increasing the diet, so there's a setup for success and we avoid that risk that there's this expectation that, oh, my god, I'm going to be to get everything in the first week on the drug, which probably is not realistic. So that's just another thing we're doing to make sure that we're set up for success and then most importantly, that the patients are set up for success.

Okay. In terms of the competitive landscape, we talked about who you are currently competing against, but how do you see this over the next, I don't know, 5 to 7 years evolving?

Yes. I think right now, the next therapies in the pipeline are ones targeting the SCLA students, I think transporter in the kidney. Very interesting approach that you think has the benefit that it's not it's agnostic to mutation. It basically tells the kidney, stop reabsorbing phenylalanine, pee it out, and that should lower the levels. Again, interesting approach. The early data are looking encouraging still a lot of open questions, right? I think the current trials in adults only. And there's a lot of questions about long-term safety of lowering the other amino acids because this target is not specific to defend on, it's all neutral amino acid. So there is this risk that if you have a lot of lowering of federal is going to be lowering a lot of other things as well. But we've heard from a lot of the prescribers is they really would love to have this as an adjunctive therapy to Sephience to be able to say, okay, Sephience is doing great. We can add something on and maybe you can do even better. And of course, in a disease like PK the patients are already used to having cocktail approaches, right? They have cocktail supplements. So we see this as something that could be on top of fiance, especially given the head start that we have. And there are some programs that are earlier on looking at specific mutations. But of course, there's like, I think, 10,000 different mutations in the drug. I think that's we don't see that as a significant competitive threat. I would say the question is also show safety and efficacy of the kidney directed drugs and we would see that being something on top of Sephience.

Okay. Maybe less than a few minutes that we have left, talk a little bit about the pipeline. So you just recently gave us an update on the Huntington's program. Can you just give us a quick recap of that and what the next steps are there?

Yes, absolutely. This was -- we shared the results the 24-month long-term extension from the PIVOT-HD Phase II study. really great results. I think the headline is that in Stage 2 patients, which is the group that we along was the right clinical trial population. We had dose-dependent lowering of CHR, 52% at the higher dose of 10 milligrams, 27% at the lower dose of 5 milligrams good effect across 3 of the 4 subscales, slight numerical benefit on the fourth subscale. -- continued safety and tolerability, NFL at both dose levels below baseline. So when you take the whole Phase II experience, what we've been able to show is that the drug is doing what it's supposed to do in terms of splicing and having dose-dependent lowering of the disease-causing huntingtin protein. It gets into the brain, we actually had higher exposure in the CSF than the plasma. We're seeing now a 24-month sign of dose-dependent clinical benefit on the disease rating scale. It's safe, it's well tolerated, and we also learned about the right population for Phase III. So in neurodegenerative disease drug development, we have ticked every box in well supported by everything that's been done so far in Phase I we mentioned Novartis, our partner, is running that study. They're going to have about 770 patients, early symptomatic patients, 1 dose level of 10 milligrams or placebo through the 2 UHDRS as the endpoint with the planned interim analysis for efficacy and futility.

And when do you think that interim could happen?

Yes. So Sooner -- so I think Novartis said they expect the full trial to go until the end of '29. And obviously, the intent of the interim was to get a read sooner on a smaller number of patients. They haven't given the specifics yet of that. I'd simply say that they've been quite clear that if they can get this drug to patients faster, they absolutely want to do that.

So that would be by an accelerated path to approval or...?

Well, the interim could be sort of stop the study or keep going to get approval on right.

And so if you think about the mechanism of this Huntington's is an area of high undermet need, but for whatever reason, it's also been difficult to drug based on where this program has reached how are you thinking about -- what's your confidence that this is something that can make it to the finish line?

Like we said all along the playbook here followed the Evrysdi playbook. The first molecule that came from our splicing platform, where we early on tried to use the blood effects of -- in case of SMA increasing as protein and being able to use that to inform the dose, figure out then the clinical study to establish efficacy. Clearly, Huntington's is a bit more complicated just in terms of being an neurogenerative disease with heterogeneity but again, I think what we've been able to do thus far in a very thoughtful, systematic approach is tick all the boxes we need to along the way to inform the next step. So to be able to enter Phase III knowing that we've got a very high degree confidence we have the right patient population. We have the endpoint. We have a dose that has the hadesired biochemical effect as well as signs of the clinical effect. I think in neurodegenerative diseases, that's about as good as you can do. And we know the drug is working on something that means something, right? It's not like we're we're going to some protein deposits that may be affect not cause, we're going to the underlying cause of the disease. So when you put all that together, it gives us a lot of -- so much confidence as you can have in neurodegenerative disease program and we've got a partner in Novartis, who's built to do these long studies long, large studies quickly and in a high-quality way.

And before we let you go, just what is the status in Europe of how EMA will want you Novartis to study this are the.

They've been working on global alignment for the clinical study. And it's going to be a global study with sites.

And then just remind us of the economics between you and Enviro.

Yes. So this is -- again, this was a really good partnership deal for us. We got $1 billion upfront. Novartis is now responsible for all of the development costs going forward. We have a 40% profit share in the U.S., double-digit tiered royalties ex U.S. and about 1 point million, $5 billion left in development and sales milestones.

Okay. And then Pierre, what is the strength of the balance sheet just based on what Matt just mentioned to us.

Very strong balance sheet. I mean you saw the evolution of PTC, some things obviously are all true patient-centric, global footprint, et cetera. But also we brought financial discipline, right? We worked very hard for that strong balance sheet because the quarter was $1.9 billion cash. that allows us to develop all our programs, a highly differentiated platform on both the splicing and the therapies inflammation and also gives us capacity to add potential products through business development in a very disciplined manner number one; and two, what we saw highly creative transactions.

What types of products do you think would be what you would look for?

So rare disease is our DNA, right? We have a global infrastructure with capacity that demonstrated that we know how to sell drug to launch globally in all geographies, obviously, U.S. Europe, LatAm and Japan. And again, rare will be core and rare metabolic,but we're looking at other adjacent to optics as well.

Okay. Good. With that, we're out of time. Thanks, guys. We appreciate you making the time. Thanks.

Thank you.