Roivant Sciences Ltd. (ROIV) Earnings Call Transcript & Summary

We're at time. So, we'll get started here. So, welcome, everybody, and thanks for joining us here at the BofA Global Healthcare Conference in London. My name is Jason Gerberry. I'm one of the mid-cap biotech analysts. Pleased to be introducing our next company presenter, Roivant, and CEO, Matt Gline. So, Matt, thanks for joining us.

Thanks for having me.

Thanks for your first fireside since the brepo data.

I think that's right. Yes. Thank you so much for having me here.

Imagine you're sleeping a little bit better. I know you're a little nervous about placebo effects and things like that going into the data, but now that everything is sorted out and you've got the result that you wanted. Maybe that's a good place to start is talking about that data. And if you want to maybe just contextualize that data, what it means for patients, how doctors you think will interpret the data and what that means for the practice ultimately of DM.

Yes. Thank you. And I was sleeping better and I was like this doesn't feel right. And so I decided to do a day trip to London instead, which will mess up my sleep. But, look, so this was a big moment for us, obviously, but I think even more than a big moment for us, to be honest, it was a huge moment for the DM community. And we have a slide in our data presentation. DM is just a graveyard of drug development. And so we went out to physicians and we were like, hey, the study works, this is what the data looked like. And we literally had physicians choking up on some of these calls because they've been through decades of everything, rituximab and Stelara and all these other things like ran studies and we're not able to get across the line. And IVIg, there was positive Octagam study, but I feel like that's viewed as an old medicine by the DM treatment community largely because they've been using it for a very long time. And so I think this is really -- this is the first time a novel targeted therapy has been successful in a registrational late-stage study for DM. And so I think like that in and of itself is a major moment for patients. It's a sick patient population with a lot of good options. When you think about IVIg, like among the popular treatment regimens for IVIg in DM is a one week a month, five hours a day regimen. You think about like what that means like halt a job or whatever. It's very difficult to make work with most people's lives. Now there's a one-pill once-a-day sort of compelling alternative. I think that's going to be important. And remember, the majority of the 75% of the patient population that is treated, is treated on steroids immunosuppressants. And what we were able to show is a meaningful benefit against the backdrop of steroids immunosuppressants while getting patients down significantly on their dose of background therapy. So, I think important in the sense that it's a novel option for the first time in a long time, important in the sense that the data was clinically meaningful, important in the field without a lot of other options. And so I think like all around, just a really exciting package.

Yes. How do you see brepo getting adopted by clinicians, right? Do you anticipate they'll still easily start with steroids and ISTs, and then at some point, look to down titrate the steroids and onboard brepo and that IVIg is kind of this last-line thing because you said it's really cumbersome. It's hard to give somebody IVIg on the schedules and the IV infusion dynamics.

Yes. Look, practically speaking, for a variety of reasons, including that it's the right place to start. These patients will go on steroids and ISTs first. And they'll do that for whoever long. I think in general, the answer is any patient who's pushing 10 milligrams or more of steroids on a relatively regular basis is going to be thinking, how do I stop doing this? It's an unpleasant experience. And frankly, it means that some level of treatment is not working the way they want. I think that entire patient population is sort of brepo eligible. I think people who are on IVIg are probably looking in some cases for a path off just given the sort of regimen they're on. I think patients who are contemplating IVIg will want an alternative. And then there are a handful of patients on other things, off-label JAKs or off-label rituximab or something like that. And I think, look, those docs, in addition to the fact that each of those drugs has own individual issues and the JAKs that are currently used are not particularly good compared to what I think brepo should have done here. I think the docs are doing a ton of work to keep patients on those therapies. And the fact that the sponsor is going to come in with an on-label drug that has really compelling clinical data, I think, is going to create a positive opportunity for us. So, I think we track, call it, 35,000 to 40,000 treated patients with dermatomyositis. And I think much of that universe, to be honest, is like eligible for treatment with brepo. And I think docs will be thinking about it for a huge portion of that population.

Okay. So you kind of see it playing in kind of both segments of the world, the IVIg segment as well as like those who are on high-dose steroids and in need of an alternative. Is there an analog you can look to, to sort of a steroid-sparing benefit in the I&I world? Like Tepezza is like one example I could think of a drug that docs hate steroids, right? And they went to Tepezza for TED.

Yes. Look, I think Tepezza is a great example because it's been so successful in TED and the docs don't like steroids. And frankly, the steroids don't work as well. And I think that's also sort of what we saw in our clinical data. I think we will see something similar in NIU actually. Those will die inflammatory diseases. I also think like lupus is a good example of a condition where steroids are aggressively used as background therapy, and you've got things like Benlysta, one of the labeled benefits of Benlysta is steroid reduction. I think a lot of what people are trying to accomplish with novel therapies for lupus now is getting patients off heavy steroid regimen. And I think it's true for other. I think it's -- I mean, I think it's true for patients with big systemic skin like psoriasis or whatever. I think it's like other conditions where patients have sort of systemic inflammatory disease where the name of the game has been getting patients off steroids.

Yes. Okay. Maybe just how do you think about the prescriber base? Because you have derms, you have rheumatologists, you have a dermatologic aspect of the disease, right? You have a muscle aspect of the disease. Rooms have historically been much more liberal about using JAKs in RA and comfortable with the risk profile of derms, historically, biologics and immune agents. So, I'm just kind of wondering, do you see this more as a drug for rooms or both? And I just wonder how that...

Yes. So, the first thing is DM as an indication is treated in a pretty concentrated fashion in the U.S. There's about 200 referral centers, some derms, some rooms that wind up treating more than half of the patient population. And the first thing is we just know all of those docs at this point, like we've engaged with them. They've engaged with us. Whether they are derms or rooms, they are familiar with JAK inhibitors. Again, there are JAK inhibitors used in derm, too, obviously, abrocitinib and some of the others that are approved in AD and there are analogs. I do think it's trivial for rooms, obviously, They, as you said, use it all over the place, and I think are sort of itching for it. I think in DM specifically, both derms and rheums are excited for JAK inhibitors as a mechanism. I think it is helpful that the safety table for this specific study, I think, sort of showed the picture in a useful way, which is, look, the truth is this is a JAK inhibitor. It will have JAK class labeling. It will have -- over the fullness of time across the fullness of patients, it will have many of the JAK class sort of issues that those things will present in this patient population. But what I think the safety analysis of this data set showed is this is just a sick patient population. And frankly, many of the sequelae either of dermatomyositis itself or of the use of heavy steroids are similar to the sequelae of the safety and tolerability concerns for JAK inhibitors. You look at our safety data for this trial and bluntly, placebo or background steroids looked worse than the drug arm in the study. And I think part of what that is a reminder of is these patients have a lot of these issues anyway and treating their underlying disease and getting them off steroids will improve their profile on many of the same axes people worry about with JAKs. And so I think that is a message that has already resonated with derms that we've talked to about the data set. And I'm just not that worried about it. I guess the other thing is it's not like derms are otherwise reaching for SKYRIZI for dermatomyositis patients. It's not available, it doesn't work. And so I think like derms are just itching for things that will treat these patients well. And I think the magnitude of effect on CDASI, for example, will just be the thing that matters most.

So, fast forward a year, a year plus, you're back to being a commercial company again. This is, I would assume, a pretty capital-efficient sort of call panel reach, if you will, in terms of promotion and promotional outlay. And how do you see this? Maybe VTAMA had its own challenges, right, because of gross to nets and payer access dynamics and challenges, right? But I imagine here, how you kind of see the go-to-market outlook?

This could not be more different than VTAMA in terms of like the way the business is built. And look, I think Organon is going to do -- is doing a nice job with VTAMA. I think there's like a real market there. But that's a low-price ground game where you're shooting for high volumes and you're trying to get -- this is a rare disease launch. So, what do I think matters for this launch? I think the sort of physician relationships matter, the patient relationships matter. And I think we've invested very heavily through the clinical trial making sure we're build those relationships they're familiar the drug. They're familiar with medical literature, they're familiar with we're doing. So, I think that's like one piece of this, and we've had sort of medical professionals engaging with the doc community since we started the study. And then the other thing that clearly matters in these launches is patient support, right? This is -- I'd say like the lesson -- if the lesson from argenx and MG has been that doc engagement matters, I think like the lesson that Horizon taught the world is that the way these launches go best is from day one, you're building a patient support organization that is helping these docs do the work to get patients covered. And we've built a phenomenal team already to begin that process, and we've got people who ran that effort for Horizon working for us now. And I think that will be the other sort of built-up piece of this. In terms of sort of traditional sales reps or whatever, the truth is that you don't need very many. It's a concentrated prescriber base. And it's more of a medical engagement conversation than like a promotional conversation.

A focus on those 200 referral centers primarily.

First and foremost, yes, although look, I think there'll be a long tail of docs excited to use the product.

Okay. And as we think about the pipeline and the drug aspect of brepo, what derisking DM does in terms of your thought process in terms of other areas to go? And just remind us your IP runway on the drug and you feel like does this afford you now an opportunity to interrogate some other indications and go more broadly with brepo?

We have competition with extensions through 2039. So we got plenty of room to run here. We are studying brepo already in two other publicly disclosed indications. We have a registrational package currently sort of under study for non-infectious uveitis, and then we have a Phase II study running in cutaneous sarcoidosis. What I'm supposed to say is, obviously, the DM data is massively derisking. The truth is that brepo was an active agent before. It has positive data in six or seven other indications under Pfizer's ownership in IBD, ulcerative colitis and Crohn's and in psoriasis and psoriatic arthritis and vitiligo. And so we knew that it was an active drug irrespective of the outcome here. And so medically, I'm not sure this like makes a huge sort of scientific difference. But I think it gives us confidence in what we're going to be able to deliver in rare disease settings, which is really where we have decided to take the product. And I have a ton of confidence now in the Priovant team that ran the study, and I think they enrolled fast, and they did great work with the docs. And obviously, the data speaks for itself. So, I think we feel really good now looking down the barrel at the NIU data, which should come first half '27. As currently guided, that study has enrolled really well. I'm excited to see what comes out of the cutaneous sarcoidosis proof-of-concept study that we're running. And then we have other indications in mind already where we're excited to get going.

Okay.

I think one of the cool things about brepo is, in 2021, when we partnered with Pfizer on the drug, it was just this like sort of tumultuous moment for JAK inhibitors where the Enbrel study has recently come out and everyone was worried about the black box warning and Rinvoq was a $3 billion drug at the time, and I think people kind of thought it was going to sort of flat line. And now Rinvoq is an $8 billion drug on a path to $15 billion or more. And I think the market has kind of spoken about JAK inhibitors, but a ton of baby got thrown out with the bathwater the first time around. And so we not like literally 100% uniquely, but almost uniquely are occupying this sort of rare and orphan disease. And I think we're the only JAK1/TYK2 combination that's focused on that or generally JAK1/TYK2 dual inhibitor that's focused on that sort of portion of the world. And that just feels like a really privileged position to be right now. I mean imagine how different the DM conversation would be if rheumatologists were gun shy about writing JAK inhibitors. They still might write it here, but it will be a totally different conversation than what we're having now where they're bluntly giving Rinvoq out like candy.

And your point on sort of the landscape of JAK1/TYK2 combination, I think Galapagos might be the only other company in the field. Is there anyone you're aware of that competitively that deals?

Biohaven has a JAK1/TYK2 that's CNS penetrant that they're doing something totally different with. Galapagos has a JAK1/TYK2 that I don't think they're studying in any the overlapping indications. And then they have an allosteric TYK2 that I think they're running in dermatomyositis study. And although it's hard to tell exactly how committed they are to that program. So, I think the truth is we don't really have competitors in the dual mechanism that are late stage.

Okay. And then with NIU, can you just remind us how you arrived at the 45-milligram dose, what discussions you had with FDA, getting them comfortable you're going up in dose and not wanting you to maybe interrogate a lower effective dose. Just.

Remember, we did run a Phase II study in NIU where we interrogated 15 and 45 on a blinded basis. And I think that was like helpful for understanding what the full picture looked like there and what the sort of range of dose benefit was going to look like. I think the view for NIU, so NIU, it's an eye inflammatory disease. There's about 400,000 NIU patients in the U.S., of which about 70,000 have back of the eye inflammation that can really only be addressed with systemic therapy. About 40,000 of those patients wind up on some kind of biologic or advanced therapy, and that's kind of the population that we see as our -- as eligible. I think our view was more so in DM, you said yourself, we're brushing up against the dermatology community and sort of think about this from their angle. In the sort of ophthalmology community, the tolerance among ophthalmologists for eye inflammation is very low. And I think they're just looking for the biggest guns to get these things under control. And I think, look, I think NIU is one of the leading causes of blindness in America. If these patients don't get under control, they lose their sight. And so I think there's like a lot of willingness to try aggressive therapies for these kind of patients. You see this with Tepezza as well, where Tepezza is not a walk in the park, but people are using it all over the place because it's effective and ultimately, they want to get the disease under control. So, I think our view was it was a good opportunity for that. I think our view is from a pricing perspective, from a patient severity perspective, especially HUMIRA is approved in NIU. And so there's a chance we wind up kind of living in a HUMIRA refractory setting. We just felt like it was going to sustain the sort of bigger gun dose. And then obviously, the Phase II study showed 45 worked extremely well.

So, it sounds like probably a comparable size market opportunity to DM ballpark.

That's about right. Yes.

Okay. Maybe we'll pivot to Graves. And you guys had a recent update on Graves. And I guess as we think about the primary endpoint selection in Graves, euthyroid and ATD free, I would imagine that these patients are in a clinical trial setting are unlikely to show any response of getting placebo.

Yes. I think placebo response will be very low. I mean the truth is that given that these are all patients who were selected for being uncontrollable on ATDs, they're like not going to spontaneously remit and be able to get off ATDs. Like that ATD-free prong is going to dramatically reduce the placebo response rate.

And so was the decision to go with that endpoint versus sort of a lower dose of ATD or just euthyroid, T3, T4 normalization, like was it -- this is the most impactful sort of endpoint for providers? Was that -- or is it a regulatory discussion? How did you arrive at that as the primary endpoint selection?

So, we're measuring all of the above. We're measuring reductions in ATD dose. We're measuring people who are not fully euthyroid, but have T3 and T4 controlled, like we're measuring a lot of things. And I think the combination of them is going to be relevant to different patients and different prescribers. I think it was a relatively easy choice to pick the big gun endpoint as the primary because it's just going to hit -- sorry, it's likely to hit. And I think it felt like a reasonable place to sort of drive the study. And obviously, FDA is not going to have any issue with an endpoint. It's obviously clinically meaningful to these patients. So I think it was a reasonably straightforward decision.

And so some of the early data, if we could go back to Phase II, I think half the subjects on the 600 mg through 12 week where I think half the subjects had gotten to this endpoint response.

The definitions were a little bit different, but we had sort of -- I think at 600 milligrams, we had about 56% of patients at week 12 who had T3 and T4 below the upper limit of normal and were off ATDs.

Yes. Is that -- because I know that when they dosed down after that because of the design of that study...

The number then went down.

It went down to like mid-30s or something like that, right? So, would you expect that rate to just hold based on what you've learned through the evaluation period, the open-label extension? And is that kind of 50-ish percent kind of what you internally think is a likely 26-week response rate?

I think apples-to-apples on the sort of endpoint measured in the Phase II, which didn't include TSH, I think the answer is, if anything, I would expect that number to get larger the longer the duration of therapy. Like as we look at these patients, the longer they're on deep IgG suppressing data, the more of them get controlled. And so my expectation would be, if anything, longer duration therapy at higher doses shows a better outcome is what I would expect to see.

And then I guess, talk a little bit about how you think this study will inform how doctors will use this -- if the trial is successful and it gets out in the field, right? Is it going to be a 26-week treatment course, a year and then, hey, the patients should be in remission? Or do you think some doctors will use it longer term because they still haven't gotten into remission? I'm just kind of wondering how you see the 26-week data and then the remission data sort of informing the ultimate long-term use case.

Yes. So, and there are -- in practice, there are patients treated for a full year in the Phase III and then there are patients treated for half a year and then off therapy for half a year. And then the second Phase III study is just a six-month study. What I think we will see in practice is that the sort of algorithm will look a little bit like the methimazole algorithm that is you'll put patients on drug, you'll monitor T3, T4 and TSH. I think some patients, just as some patients are sick enough that methimazole just doesn't get them there, and so they stay on methimazole for life. I think there will be some subset of patients who like are sick enough that we are not able to get them fully controlled with this therapy. And I think those patients will be on it chronically. They'll stay on this drug. And when I say controlled, like maybe they'll get T3 and T4 in controlled but TSH will still be elevated or whatever, like I think it's just going to be different depending on the patient. But I think -- what I think docs will look for is they'll look for thyroid normalization. And if they see thyroid normalization, I think they will start to have a conversation with their patients about whether they want to try a holiday based on the data that we've seen here. And I think some patients will say, I've lived through uncontrolled thyroid hormone levels for many years and no, I just want to stay on a drug that's working for me. And I think some patients will say, yes, happy to stop taking a weekly shot if I can. And I think that's how it will get used in practice. I think like after six months, docs will start to like track thyroid hormone levels and some patients will need to stay on and some patients will choose to stay on and some patients will choose to take holidays.

That what you said reminded me of something I've heard from some doctors about methimazole or ATDs, which is that they're keeping patients on longer than they should be on. Basically, like in the hope, and hope is never a good strategy, but in the hope that like they maybe have a response after a year or two. So when I think about your patient numbers, right, and how you characterize, I wonder how you estimate that dynamic, right? Because if 1402 is approved, I imagine this is a paradigm change, right, for these doctors. And so perhaps some of that practice stops, right, where doctors are like, you know what, I'm not going to keep somebody on an ATD beyond a certain time point. How does that paradigm shift?

What I think is definitely, in my opinion, going to happen is right now, if you're a patient on methimazole and you're not controlled. Your thyroid hormone levels are still moving around, you're just on methimazole, to be honest, like -- and what I think happens to a lot of patients is they're not controlled. They go up, and up, and up, and dose on methimazole and they get to 20 or 25 or whatever. And then they're unhappy on methimazole and still not perfectly controlled. And so they go back down to 10 or 15 and they just like live with it. And the ones who are really unhappy, then go get thyroidectomies and things like that. But otherwise, they're just sort of living, bouncing around and whatever, some six-month period, they decide to go back to try and higher methimazole dose and they deal with those consequences and sometimes they take a break and they deal with the consequences of the thyroid hormone levels being out of whack. What I think will happen after we're approved, knock wood, is after whatever, after six months of methimazole not working for a patient, the doc will say, hey, I've got another option for you and it may work better. And so I think we will see is instead of patients being on these sort of long duration bouncing around methimazole kind of regimens, they will transition to 1402 as a last line therapy.

Yes. Okay. And so you have these two buckets. You have an incident kind of bucket, right? And so those patients may get determined to be candidates in a more expeditious manner than you have the prevalent pool of patients and perhaps they're lingering on methimazole for...

330,000 of those were just walking around effectively on methimazole and uncontrolled all the time. So, yes, there's a huge patient population in that prevalent bucket.

Who's taking care of these patients right now? Like how do you kind of understand kind of where these patients are at in the treatment system? And is this all generally a primary care kind of setting?

It's not. It's endocrinologists is the answer. It is a range from academic endocrinology practices to community endocrinologists do treat Graves' disease, including chronic patients. And so it's a mix. Interestingly, the academic docs tend to believe they can control any patient. And the patients don't always feel that way. That is like some of the patients are like, my doc put me on 25, methimazole, and he or she thought it was going to work, and I hated it. But the academic docs tend to feel like they can, whereas the community endocrinologists who often, I think, live with more of the chronic patients they live with the more standard chronic patients, right? They like dealing with this for many, many years. They're not like always going to an academic center. I think those docs are like obviously receptive to new options for those patients. But anyway, they're treated endocrinologists. It's a bigger prescriber base than in something like dermatomyositis because these community endos, there's like a lot of them, but that's who treats it. And I think there's -- the data that we showed earlier this month, the like sort of disease modification data has clearly been an eye-opener for docs in terms of like value proposition because a doc who previously was like, yes, I can drive response from high-dose methimazole, I think those docs were like, so why would I try something new? And I think the answer is, well, if you do this for six months or a year, you may get your patients off methimazole is a very compelling answer.

Yes. Okay. So you'll have some data for the previous generation of FcRn, 1401, and TED.

Yes.

I think toward the end of this year.

Yes, that's right.

So, let's just say you see fabulous data, right? I think you've shown some data through five week, I think, was what I recall.

A little bit more than that. Yes, yes.

And it looks directionally similar to IGF1R approaches.

Yes. Directionally is a good word for it. Look, I think IGF1R...

Well, small sample, right?

That's right?

But as someone who would cover Horizon, I remember looking at that and handicapping that as a competitive threat. But if that data are encouraging and support the FcRn hypothesis in TED, how do you think about maybe would you adjust your Grave study to include a stratified subsegment of TED? Would you want to elucidate the benefit for 1402 to get some label language around treating specific thyroid eye disease manifestation.

So, we thought a lot about this over time. And I think initially, we had contemplated stratifying in the Phase III to make sure we got TED patients. What is immediately clear even from the Phase II study that we ran is we don't need to stratify. There will be plenty of TED patients in the study no matter what. And we absolutely -- TBD on exactly which, but we absolutely will have key secondaries on proptosis and the development of TED that will allow us to make, hopefully, label claims, if successful, about the development of TED. And I think that is, first and foremost, as far as Graves is concerned, one of the things we'd like to do is be able to tell endocrinologists if you put patients on this drug, it will forestall the development of TED, it will slow the development of TED. If they have early signs of proptosis, it will help them. I think one of the things Graves' patients worry most about is developing TED and having either risks to vision or it's just like a tough aesthetic thing. It's uncomfortable. And so I think being able to say this will help there is good. Obviously, if the TED data is extraordinary, if it looks like every bit is good in an IGF1R, but without some of the side effects, there's certainly an option to launch batoclimab or an option to add either a stratification that allows us to get a label for TED or a separate TED study. That's certainly like an option if that data is extraordinary. But I think we prefer in some ways the angle of like going after the endos and helping keep these patients out of the ophtho office.

Okay. And maybe just a few other topics within the FcRn realm, RA. What underpins the confidence here? I think J&J was supposed to have some Phase II data for nipo here in the ACPA plus population. I don't think we've seen it yet. We have. You've seen it.

Yes. So, J&J put out the data from the combo study this summer, I think, and they didn't show separation from -- so as you remember. So, J&J showed data in the monotherapy setting like two years ago, and it showed activity. It was clearly an active drug. And it was clearly even more active in the ACPA-positive population than in the general population. And it was also clearly more active in patients with deeper IgG suppression. What J&J then went and did with that data is they ran a combo study with Cimzia to show sort of -- ideally to show adjunctive benefit on top of TNF therapy in a relatively early line of patient, and they didn't see what they were hoping for. I think our view is, first of all, and that was enriched for the ACPA-positive population to your point. I think our view was, first of all, J&J has dosed nipo in a way that does not suppress IgG as deeply as we do. And second of all, that showing performance on top of a TNF was always going to be a little bit tricky just given how well TNFs work in this patient population, which is why we went later line and why we went -- why we always believed that deeper matters. It would have been nicer if they had seen more separate. I think it's data referring to. It would have been nicer if they had seen more separation from the TNF-only group, but I don't think it materially changes what we're trying to do. You asked about confidence. Look, I think this is the bar -- the bar for excitement is relatively high for us in that it's an open-label portion. It's a run-in portion of a randomized withdrawal study. And so I think like you got to sort of discount it from that perspective. And then I think it's a tough patient population. But if we're successful, it's obviously a big opportunity.

Yes. So, this is probably in the higher risk of your portfolio of indications.

Absolutely. Yes. Absolutely, yes.

Then what would you just need to see then in this open-label trial?

We haven't set a -- but again, this is the open-label run into the randomized withdrawal study. We haven't given a number. But I think you'd want to see response rates that look obviously, highly compelling for a fourth-line setting is what I would say. Like I think unambiguous is what we'd want to say.

Yes. And then with MG and CIDP, there's great validation commercially now, right, the lead. And so I know that there was some data that you guys had with your first generation, and it's obviously difficult for the comparisons to be made across trial because there's some different metrics that are out there around super responders. And, so ultimately, as we kind of fast forward, where do you see that fitting within the broader portfolio? I imagine Graves is the anchor. Something like RA is -- I don't want to call it a moonshot, but it's the higher risk, big opportunity. And then MG and CIDP feel like low risk and maybe don't have the upside opportunity unless maybe you ultimately end up differentiating on the form factor and/or the IgG suppression gives you some directional unique data points to market?

I don't think I get much benefit from disagreeing with that point of view now. Look, what do I actually believe? I really like the data we showed in March. I think it did show that deeper IgG suppression matters. I know there was debate over that point. I know not everyone agrees. And I think if we can move the field as every other immunology field has moved towards remission endpoints, towards MSE endpoints, towards sort of deep responders, I think we will be better able to deliver those kinds of endpoints than our competitors because of the depth of IgG suppression, I think it will matter. I think that is correctly viewed as an upside scenario commercially in that. Look, the truth is argenx has done an amazing job building support and understanding in the doc community. And I think kudos to them. I think that efgart is an enormously popular therapy, and it will be difficult to unseat in any meaningful sense. I think the truth is with the size of MG as a market now, even if we take relatively little share, the drug is going to work in MG. It's got a nice form factor. Maybe some people will find the extra benefit of deep IgG suppression compelling even if others don't. And it does not take a lot of share for it to make lots of economic sense to run the study. So, I feel really good about it as an indication. But in terms of like what I think is going to capture the hearts and minds of investors at this stage, I think MG is just going to be whatever it will be in people's models, I think it will be MG positive in people's models, but it's not like the thing that's going to drive the story. And I think that's fine. I think CIDP is a little bit different in that I think it's clear I think argenx is also doing a nice job in CIDP. I think it is clear there is more room left on the table in CIDP than in MG, right? You see some of these like articles that suggest that docs are washing patients off IVIg and are not happy with sort of the lull in the middle. And I think our early CIDP data looked pretty good. And so I think if that continues, I think we have an opportunity to be a bigger sort of obvious player in that market. But I think we've got to hit that bar.

Okay. Maybe I'll come back to some early pipeline, but I wanted to hit on LNP litigation because it seems like we're in a very actionable phase here in 4Q with the Section 1498 government contractor defense and whether that's applicable, I guess, the consequence of it could sort of fragment the litigation pathway a little bit if it was deemed applicable. But I guess, will we get clarity on 1498 applicability? I know that we have to size that applicability in trial, right, as I understand.

Well, yes. So, what Moderna in their own frame has said is their view is that 1498 in the U.S. trial, they believe it should cover a little bit less than half of the sales. Obviously, we believe it shouldn't be applicable. So that's sort of the dispute as it were. And the most important parts of that dispute will be settled by the judge in summary judgment in all likelihood. So we will know the answer to that question. Now half of what is still a question that will be decided in a trial. We've asked for $5 billion in damages before enhancement for woefulness. And so Moderna has said about $2.4 billion would be covered by 1498. The denominator there, whether it's $5 billion or $4 billion or $6 billion or whatever will be decided by a jury. Whether 1498 applies will mostly be determined by a judge in the summary judgment phase. And I say mostly because there are some corner cases in which parts of that question go to a jury, but I think the most likely thing it is mostly decided by the judge here.

And just so I know, is there -- is it tied to a specific hearing for summary judgment or we just don't know more specifically when within this time between now and the March trial, like when that would.

At this point, the issue is briefed. That is there was a schedule for -- we both got to submit summary judgment briefs and then motions and then there were sort of briefing and counterbriefing and counter counter-briefing, and that's all largely done now. So, the judge could, in theory, rule tomorrow, although that doesn't seem very likely, the briefs just went in. The original time line for the case set forth by Judge Goldberg, who was the previous judge on the case, which is the time when we're currently on. I think it was clear that Judge Goldberg intended to rule on this issue in October, November. There's a new judge on the case now, and he's new to the fact, so he may take a little bit longer. It's sort of at his discretion. So, I don't think we know specifically, but it could be this fall, it could be early next year. That's kind of where we're at, right.

And any clarity on the OUS legal proceedings? I know that, that's kind of kicked off. And just like generally, how should investors think about that? I imagine OUS litigation tends to be a little more fragmented.

It does. I mean there's more jurisdictions. It moves faster in a lot of other jurisdictions than it does in the U.S. So we started these proceedings last spring, this past spring, and I think we will start having like real infringement hearings next spring, so within a year of launching the proceedings. And I think that means there'll be sort of a good drumbeat of progress between the U.S. trial in March and then like the sort of surrounding months where there will be actual infringement determinations made by courts in other jurisdictions next spring. And I think that's mostly -- look, I think the fastest path to a resolution is that somewhere along the way, we have Moderna have a productive conversation and reach an agreement. And I think the existence of the ex U.S. trials give everyone clarity on like what the picture looks like sooner.

Well, it seems like you can't have a conversation until 1498 is decided.

I think that's mostly true.

And then you have the Pfizer matter where there's been claim construction. Is 1498 still a similar relevant consideration or not?

Pfizer has not asserted 1498 in their case. Remember, their facts are a little bit different in terms of like how much government funding Moderna to versus Pfizer, but also Pfizer just hasn't asserted it. And so it's still possible they could raise it later. But at the moment, it doesn't appear to us that Pfizer has decided to go down that road. They certainly haven't sought a dismissal on that.

And with respect to the claim construction rulings in the Pfizer matter, do you feel like there are any material difference in outcomes on the interpretations of key claims?

We were obviously very happy with the Moderna constructions. And my view bluntly is that there was more downside risk than upside for Pfizer just because simply getting the same outcome as Moderna would have been a good outcome. It was probably on the margins better in the Pfizer case in that there were a handful of issues in which one in particular, most of the issues, the Pfizer judge went the same way as the Moderna judge. In one case, he literally just excerpted a piece of Judge Goldberg's opinion and said, I find this compelling here it is. But there was one specific case, which is probably too technical to go into full detail in a minute in 26 seconds. But on the meaning of encapsulation in the 651 patent, the Moderna judge chose a relatively complicated definition for fully encapsulated and the Pfizer judge gave us a much simpler and more straightforward definition for fully encapsulated. And I think that will be helpful to us, specifically as it pertains to 651.

Okay. Maybe coming back to pipeline. Your sGC. I cover United Therapeutics. So, PH-ILD is a very interesting high-growth market. And so, just kind of curious, as you advance the program, I think you have some Phase II data next year, second half. Is the focus really concordance of both the hemodynamic aspect of the benefit on PVR as well as six-minute walk? I know six-minute walk can sometimes be considered a little noisy in these trials. PVR a little bit more of an objective measure. So, how do you kind of think about those data and informing steps?

Look, I think there's really two questions in the Phase IIb. I think the first question is just does PVR -- we saw very good PVR reductions in the PAH Group 1 population. And I think like there's a question of like what does that and tolerability look like in the Group III PH-ILD population. I think it is extremely likely that if PVR translates from Group 1 to Group 3 that the clinical benefit will follow. I would hope that we get a pretty clear picture of what that looks like in terms of six-minute walk and time to clinical worsening in this study as well.

Okay. Well, we are at time. So, Matt, I appreciate you taking some time to talk on the latest developments. I appreciate it.

I appreciate it. Thank you very much.

Thank you.