Regeneron Pharmaceuticals, Inc. (REGN) Earnings Call Transcript & Summary

Well, I think the opportunity for Dupixent growth is substantial and continuing, and I'll give you all the reasons why. One is that today, across our approved indications, we've only in the U.S., captured about at 6% of patients who meaningfully benefited from Dupixent across atopic dermatitis and the respiratory indications. So we've only really just gotten started in our early launch efforts, for example, in atopic dermatitis, we concentrated on the 300,000 to 400,000 patients with most significant disease. The fact of the matter, if you add all the patients up against our approved indications, it's really about 2 million -- 2.2 million patients who potentially would benefit in a very important way. But I think competitors coming into the marketplace will actually help with the education of seeking treatments and getting care. And here's a situation kind of going back, Geoff, to your questions earlier on competition, where Dupixent's profile and clear differentiation as standard-of-care first-line care for these patients is so important. We're not an immunosuppressant. We have excellent efficacy. The safety profile is so well established that we have indications, for example, in atopic dermatitis for adolescents and pediatric. So age 6 and up and obviously, now, a lot of experience with dermatologists, allergists and pulmonologists across multiple indications and an ability to help with type 2 disease. So it's not just one indication, it's multiple indications. And it's this very specific mechanism, dual mechanism of action that is creating this result of multiple indications, profound clinical efficacy and then also safety. And as we look at the lay of the land of competitors coming into the marketplace, even some of the [ JAK's ] early days are positioning themselves after Dupixent, and the profile is very different in these products, specifically black box warnings, lab monitoring. And these are really significant hematologic, cardiovascular infection types of warnings for patients who have a chronic condition. So while, again, as I always will share with you, we will look at competition very, very seriously and very carefully. I think the Dupixent's profile now in our fourth year in market with launch going very well, and we'll continue to perform in a very, very positive way. Competition always makes you better. And I think in this case, it's an opportunity for even more patients to be educated and for a noise factor to take place in the marketplace that potentially is very beneficial to Dupixent as we continue to advance our first-line position.

Okay. And just to follow up on that. You mentioned the 6%. So if I was looking at psoriasis, and asking you what the percentage is, and I know you benchmarked against that, where are we in psoriasis? And is that a realistic goal in atopic dermatitis?

I think that we're keeping pace. I think we have a lot of opportunity. It's a different market. The window of time and numbers of entrants is different. So we're not comparing absolute likes. But I do think there's powerful learnings in the market. And I think there's also powerful learnings in terms of major products with multiple indications that have become among the largest biologics in the industry. And that's the type of product we have in Dupixent because we're helping that many patients in a way that they haven't been able to find care. Even as an example, launching into an indication, which is highly competitive biologic asthma with Dupixent, very quickly, we established education, clinical profile, competing with companies that have been in that space for some years to become a market-leading product that not only took share from asthma biologic competitors but also grew the entire market.

Okay. So since I couldn't get you to tell me where the 6% is going to go to, I'll ask you another number question. So what's your average duration of treatment for your starts in atopic dermatitis so far?

Yes. So when we look at the persistency and the retention of patients with Dupixent, it's very, very high as we're getting out towards, for example, oh, even 6 months or so. We're retaining 70%, 80% of patients. As you know, the data in this area is not perfect. But certainly, the durability of response, the [indiscernible] and the compliance of patients is very, very high in this area, far higher than industry average and far higher than conditions that don't have the very bothersome types of effects of skin pain, itching, the need for that healing effect or an asthma inability to function and go about normal activities due to the impairment of their breathing. Same is true with nasal polyps, which allowed us to not only participate with allergists, pulmonologists, but now we're working with ENTs as well. Half the patients who go on to Dupixent for nasal polyps have had a surgery previously, half had not, but it restores, for these patients, their ability to breathe, to taste food and to function more effectively.

Okay. And -- sorry.

Geoff, I was going to cite examples to you of why patients are not likely to come off therapy as you might see in other areas that are less bothersome.

Okay. And in terms of the -- again, the mix of the Dupixent revenue, the impression, I think we have is that the vast majority of it is still atopic dermatitis. But are you sort of into the 20% to 30% range with other indications yet? Or is it still even higher skewed towards AD?

Well, it is -- majority is AD, as you say, but we're starting to move towards that being about, oh, 70%, 75% and then other indications picking up the rest and growing rapidly. So we do think we have a product that's going to have a lot of diversification. And we're very pleased with the ability to have competed so successfully in asthma, which obviously is a larger indication, nasal polyps. We look very much forward to hopeful FDA approval for pediatric patients in asthma this year, again, with great confidence on the clinical data we presented to FDA, both efficacy and safety profile. And then, Geoff, as you know, a whole host of indications to come for Dupixent, not only in the areas of skin, but really important areas of unmet needs like eosinophilic esophagitis, where there is so little to help patients who have tremendous difficulty seeing gastroenterologists, it's still unable to eat appropriately, end up in the emergency room, with esophageal impacts, really difficult situations, and we probably have an underestimation of the patient population for some of these indications. Because there's been so little.

And back to you, Justin. Just on the timing of the EoE data, I think you've progressed to Part 2 of the pivotal trial. So what's your latest guidance on when you might see -- we might see the results of that Part 2 and then be in a position for you to file?

Right. It's probably more of a complex answer than the question. When we originally set out in EoE, just again, to level set everyone, the 3-part study. The Part A is what we reported out on last year, and that was sort of the initial proof-of-concept type work that we were doing. Part B was intended to be the larger confirmatory data set, so to speak, and then Part C is really just a longer-term follow-up for all patients who complete parts A and B. When we talked to FDA around the registration package as a whole years ago, the thinking was that we would need parts A and B and probably some supplement from the follow-up as well. That was before we saw the really dramatic type of data. Greater than 60% of patients were seeing a real benefit in Part A of that study. And so what it has allowed us to do is apply for and receive Breakthrough Designation for that potential indication. And everybody knows what Breakthrough means now over the last several years. It means that we can have frequent and ongoing discussions with FDA around, ultimately, what is the approvability package, so to speak, that needs to be pulled together for the program? So I would say those conversations are ongoing, hence, the -- really not the ability to give a precise or definitive answer on that. But again, the magnitude of effect we saw in Part A not only allows us to have these conversations with regulators, but it also has allowed us to downsize Part B of the study, given the effect size was so significant. So that part of the study is now fully enrolled. We do expect some sort of completion to that portion of the study towards the end of the year. So there's a lot of different moving parts that could ultimately influence when we could submit and ultimately get this approved. But I would say we're in a good position given the data that we have.

You are right. The answer was more complicated than the question. Marion, so again, you have a competitor coming with data at the end of this week from your pharma competitor, Amgen. It seems that Regeneron and Amgen are always going toe to toe. What should we be looking for in the pivotal trial results for the TSLP to determine whether it is a viable competitor to Dupixent?

Sure. So I think the more robust data will be interesting to see. And I guess one of the things would be is what niche of patients potentially are benefiting from the product, recognizing that with Dupixent's and other current products available in the market, is there a potential area of improvement? And what might that be? There's a bit of confusion on what the patient profile might look like. I do think -- I mean, I speak to Dupixent's indication and profile, certainly for those patients that are high oral corticosteroid users, which is common in high eo patient populations, we offer and more a very compelling profile for their asthma care. So I think the question that's out that I hear for most is not quite getting what the patient population would be.

Okay. And we just have a couple of minutes left. So you and your partner have announced a pretty significant investment in COPD. And biologics for asthma today, I'm guessing probably around $4.5 billion and growing between all of the different competitors. So is it your expectation that biologics for COPD could be as large? Or could they be several times as large as asthma?

I think at this point, the important thing for us to do is to progress our clinical profile, participate in the marketplace and then see what the appropriate patient population is. But Geoff, without giving you a specific number on size of market, which I just don't have at this point, it is a substantial opportunity. There is so much unmet need for COPD patients that if we are able to bring forward a biologic solution for this patient population, it will be very exciting. And it also will be a substantial population.

Okay. Now Marion, just a couple of other just logistics questions. So...

Maybe, Geoff, before we move on, I wouldn't like to add. So we have Dupixent that's in Phase III. But I think a lot of folks don't appreciate that we have a potentially even broader population that we're looking at with IL-33 itepekimab. That's also a Phase III. And Sanofi gave a little bit of a teaser in their Capital Markets Day back on February 5. So I would say, it's really almost a 2-pronged approach against COPD that's probably worth calling out.

Yes. No. I was hoping, Marion was going to tell us how much -- what the revenue opportunity there was.

I will in the future, Geoff, if you hang on, I will in the future, and as Justin points out, it's with 2 opportunities. So...

Yes, fully aware of that. Now, Marion, have you been expanding your empire internationally? Is this something that you did talk about last year and sort of building the capabilities to support your products outside the U.S. Is that something that you've actually started investing in?

Yes, we haven't actually started putting the full platform in place, Geoff. It's something that we're looking at very carefully, very thoughtfully. It certainly is an opportunity to do so potentially within our alliance products. But we're looking at this very carefully, and certainly, we'll make appropriate levels of investment, perhaps, in a targeted country basis. And certainly in the future, we'll provide more on that. But we haven't actually fully initiated that. We've got preparatory steps in place.

Okay. And then one last question. So congratulations on the recent approvals for Libtayo in BCC and now non-small cell lung cancer. So kind of one very large opportunity and one incremental one. But what is a realistic ambition for you in non-small cell lung cancer in terms of market share? Do you think it's realistic for you to get to 30% share going up, I guess, a very powerful incumbent?

Yes. I think it will perform well. It's only a couple of days into the launch, Geoff, as you know. But going back to our conversation of launch competitive opportunities, when you look at the profile of Libtayo, our clinical data and certainly, the data is being reviewed very carefully by the lung experts of the world and certainly in the U.S. where we're launching. Early days market research shows that oncologists looking at our data profile, approaching easily 2/3, want to evaluate and trial Libtayo. So early days. We're working on that early experience, the proper education in market, our promotional platform and the rest will take care of itself. But we think we have a really compelling profile. Oncologists want choice. Lung cancer sadly is an incident population with about 200,000 diagnoses each year. There's great interest in evaluating products and determining what's appropriate for patients based on their unique profile and their cancer. And I have a team that demonstrated establishing Libtayo as a standard of care for cutaneous squamous cell carcinoma in record time, albeit a small indication, but we've always built with the future in mind, and I have a very sophisticated oncology team with a lot of commercialization experience, including lung.

Terrific. All right. We've run out of time. Marion and Justin, thank you so much for participating in GHC, and congratulations again on all the recent approvals and progress. And good luck with the commercial efforts.

Thank you so much, Geoff. Appreciate it. Stay well.

Thanks, Geoff.

All right. Thanks very much. We can wrap up now.