TG Therapeutics, Inc. (TGTX) Earnings Call Transcript & Summary

[indiscernible] to 2025 Jefferies Global Healthcare Conference after lunch break, and then we have -- it's my pleasure to have the fireside chat with our next presenting company, TG Therapeutics, CEO Mike Weiss.

Thanks, Roger. Great to see you.

Excellent. All right. Another year. So -- but I think the TG story is getting better and better every year and then every quarter. So I think given the focus almost now is exclusively the CD20 MS story, obviously, you have on the pipeline, we're going to touch that later on, but that's a key focus for most of the investors and TG as well. Can we just take a step back just to reflect how the CD20 MS market is becoming now and then how this will evolve in the future considering we have a couple of moving pieces in terms of IV versus the inject -- IV versus subcu and then maybe some of the -- you have a new regimen coming and maybe some of the other MOA upcoming?

Yes, sure. So yes, the CD20 market right now in terms of, I guess, dynamic and overall market share, right, is the leading treatment for MS patients. Dynamic market share continues to creep up. So we're -- we feel like we're going to continue to see that in terms of the -- all the CD20s will benefit from any shifts as we move forward. And I think that's probably just a function of as more and more newly trained MS clinicians get into the field, they are definitely more likely to treat with an attempt to give the highest efficacy early, right? And that's most of them -- I'd say most, if not close to all, of the major KOLs feel that way. But there's still a contingent of folks out there, established neurologists, general neurologists who aren't using CD20s yet, right? So that's still going to expand again. So as these younger generations are being trained and growing into the field, you're going to see a bigger portion of patients go on to CD20s. So I think CD20s are in a great position as a whole. And then in terms of just the IV to subcu distinction, right now, there are -- well, there's 2 subcus available. But one is what we call a true subcu product, something that an individual can take it home. It's an auto-injector. And it's what one would expect of a subcu product in the year 2025 and beyond, right? So that's -- that one is there. So -- and they are capturing all of the true subcu business, right? So they currently have a monopoly in that area. And I would say that they've grown well into that spot. And subcu is growing and has grown. I don't -- maybe slowing now, but it's growing and it's about 35% to 40% of all new starts. And I think that's a function of, one, academic centers and insurance companies forcing site of care and away from the IV centers at these major academic centers, which are extremely expensive. When they give infusions in the community centers, they're very efficient at what they do. In the hospitals, they're very inefficient. And they charge -- I won't say they're inefficient. They just charge. They might be efficient, but they just charge incredible sums. In many cases, they charge more for the actual infusion than the drug cost. So that's been an issue. So in a lot of academic centers, you'll see them moving to the subcu self-administered at-home product. And then I think the folks who are -- who have developed and marketed that drug have done a pretty good job of engaging with neurologists who don't use CD20s who are willing to write prescriptions for that. So I think there's a nice market. I think it's going to continue to grow. But I think overall, the IV will maintain its position as the leading mode of delivery of CD20s. But we'll see. I think either way, as you'll -- I'm sure we'll get to, TG is hedged -- or should be hedged. I can't promise it, but we should be hedged.

Yes. Yes. We're definitely going to talk about BRIUMVI, TG's product, in a moment. Maybe just wrap up the whole market dynamic. What's your expectation for the future CD20 MS, this class for MS? Because some of the investors worry about this class is shrinking, which I don't believe so. We did some sales analysis. It seems to continue to grow. But in terms of patient number, right? So how we think about in the future, you think that, as you mentioned, maybe young doctors coming to practice, they were more comfortable using CD20 as a B-cell depletion therapy. And then how you think about the overall CD20. And then how you think about the split between the IV and the subcu because you mentioned you think the IV is still going to be leading segment. But just give me some numbers that we can be satisfied...

Some numbers, yes. Well, like I said, I don't know that I have numbers other than right now, it's about 65-35, maybe 60-40. Again, it depends on -- it's hard to get the exact numbers, but split. And again, I think there's probably some continued growth on the subcu side. But again, I think IV will maintain its position. I think overall, it's a great -- the IV is a great product profile. You don't have to worry about compliance. You get to see the patient they get eyes on. I was just at CMSC talking about these very issues. Again, some people are really so committed to the IV. Again, they want to make sure the patient gets the drug. They want to see the patient. They want -- whatever, eyes on the patient, right? Some people, they give them the subcu and they never see them again. And that concerns them because they don't know what's happening, if they're being compliant, if they're having problems. If they have a major problem, I'm sure they'll show up. But if they're having issues that are not fully manifesting in clinical symptoms, they could be having issues that they're not aware of. So I think there's always going to be a very strong pull toward the IV side. But like I said, there's plenty of forces that are working toward this subcu.

And then I think that the overall CD20 market, right now, I believe it's around like 55% of the new -- the entire kind of MS patient using CD20. So you think this trend is going to continue into -- the patient numbers continue to grow?

Yes. I mean look, we think it's somewhere between 50% and 55% dynamic market share. So that's new starts for CD20. I think it's still less on an overall basis. Again, that's just over time that -- over time, the overall market share will catch up to the dynamic market share, but it does take years for that to occur. But for the moment, yes, we think in a dynamic share in new starts, about 50%, 55% will go on CD20. And that's up from when we started, which was very close to 50% or upward. We're approaching 50%. So it's creeping up. Again, I don't see it going down. I don't see any factors on the horizon in terms of need for high-efficacy treatments, convenience and scope of how CD20s operate that there's nothing on the horizon that would usurp that position. And like I said, as more and more newly trained clinicians come into the marketplace and they're all trained on high efficacy first, the choices are limited. TYSABRI still is a great option. But other than that, it's CD20s, right? And so it's a doctor-patient decision, but I continue to believe that the CD20 class will grow in dynamic share.

Any other mechanism outside of CD20 can you think potentially can change the dynamic market share for CD20? Like we see BTK data, but it seems that no longer be -- used to be an overhang, but it seems no longer that scary. But any other mechanism you keep eye on?

I mean that is not that's near term. I mean -- no.

Yes. Okay. Good. All right. Let's focus on BRIUMVI, right? Because we -- overall market is important because BRIUMVI is 1 of 3 player right now, right? So that's why this market is important. So for BRIUMVI, sales continue to be outperforming people's expectation. Honestly, when you launched it, there are a lot of the skepticism there, which is rightfully because it's not easy for a smaller company to compete 2 major pharma out there, which is you are very successfully capturing the dynamic market share. But you also made a very bold statement that you're going to -- you want to be the #1 dynamic market share within the CD20 market. So maybe just what are the key drivers so far having a pretty good sales trajectory? And then what's going to eventually give you the potential to become the #1 in the future?

Sure. Yes. So yes, I mean, look, everyone has got to have goals, right? I mean we want to be #1. We didn't get into this market to be #3, right? We're starting out at #3, but we got to be #1. And what is it going to take to get us there? I think we have all the elements. I think time is really the last piece of it, right? So I always go back to the 3Ps and then I'll add the fourth P, which is product process, people, and I'm going to add price also, right? So we're priced as the lowest CD20, lowest branded actually treatment for MS. And then -- so in terms of product, we believe we have the best product, right? I'm sure others might argue differently. I don't know how they could, but they could try. But we feel very confident that we've got a product that's at least as good and we believe provides attributes that make it best in class. We brought in the best people, right? So if you want to market a drug, you need the right people. Adam, Jane and team did a fantastic job in hiring people with -- I think the average experience in MS was 12 years. So unbelievable group of folks. And then you mix that with the right process, right? So our marketing strategy, I helped create it. I think it was brilliant. I think the team has executed it brilliantly. And -- but it's how you show up. It's how you operate. In a competitive market, having the best product at the best price doesn't always win the business. But if you have the best people and they show up in the right way, you have your chance of doing that. We put all the 4 pieces together. We think it's just time now before we're #1.

Okay. Also the time, which -- we take some patience to get there. You didn't say next year you're going to get #1.

I did not did.

Yes, you did not.

But it's possible. I did not say that though.

That's another ambitious goal. Stretch goal.

Stretch goal, exactly. Stretch goal category.

But those 4 pieces are absolutely very classical kind of go-to-market strategy. So anything you want to do differently or further enhancement to be able to get there or something just take time to continue to execute in terms of your sales, the size of the team. And then you recently said you may do some DTC or digital. So anything like that, you will be able to achieve the goal?

Yes. All of those are part of the plan, right? So when we set up the plan, it was target the most impactful clinicians first and then concentric circles widening, wider and wider. And to do that, you need to add people when you do that, right? So we always had this vision of starting with a small team that was focused on a certain group of clinicians, expanding the target list, expanding the group of people, expanding the target list, expanding the group of people. So we've done that. I think we probably doubled our commercial team since launch in a very strategic way. We've identified the territories, the centers and people that we needed to be able to have connectivity with. And so that's been working great. And we'll continue to do so, right? So I think we're getting close to a point where we're -- I think we have the full team. But I think there's probably more because, again, as we get into the subcu, that will expand to another layer of potential neurologists. So I think we're nearing the completion for the IV team build, although I think there's probably a little more to go. I'm going to push for more, actually. We'll see what the team says. But anyway, so I think we're in great shape there. And then one of the -- the team -- if you look at the awareness of BRIUMVI in the patient community -- it's good but not great, right? It's probably in the mid-30% range, give or take, whereas I would assume that KESIMPTA and OCREVUS are going to be 70% plus, right? But despite that, we've done an amazing job because the clinicians believe in the attributes of BRIUMVI and believe that it can help their patients. But what we do hear not infrequently is that individuals will come in. They'll have heard of one of the other drugs through DTC marketing. And the clinicians have asked us -- they've asked us. They said, look, it would help to have better awareness. So that's a big goal for us, to improve that awareness and grow it. But again, I think testament to the team and the work that they've done in engaging with clinicians. Despite the fact that it's the least well known of the products, we've done an amazing job in capturing market share. So I think only good things can come from the DTC campaign. I mean we've started. We've been doing for the last 6 or 9 months online DTC. We've just updated and expanded all of our materials. And obviously, we've just recently launched our first full-scale, I'll call it, TV commercial. Most of it is probably online anyway, but we're doing some -- I don't know. I call it TV. Whatever anyone calls it these days. No one watches it but me, apparently.

Yes. Yes. Yes. I think you told me watch out for your TV on -- Netflix or whatever program you're targeting...

Everyone, let me know when you get hit with the commercial because I assume you guys look at MS stuff. So if you don't get hit with the commercial soon, let me know, and we'll try to fix that.

Awesome. Okay. Good. So that's your -- based on your current profile, which I agree you have an advantage over the current product, for the IV side. But you are continuing to enhance the profile because you see some data from your ENHANCE trial to see, okay, if I combine the first, second dose as the initial patient and then even faster, right? Right now, you're already 1 hour -- true 1-hour infusion, better than any other IV, and then you can even accelerate that into 30 minutes. You don't see any issue with that. So tell us about that development time line and plan. And then based on your market research, how much do you think this profile can attract more patients, helping you to get there for the #1?

Yes. So I agree. Those -- we're not sitting still. Obviously, we're doing everything, as you said, on the sales and marketing side. But the development and innovation continues and really with the goal of just making sure we can make the patient experience as good as possible. That is kind of the goal. I mean no one ever wants to be treated for a condition like MS. But if you can just make it easier or better, why not try? So yes, so we're continuing to, we believe, improve upon the already quite easy-to-use BRIUMVI, which is right now, you come in on day 1. You get a 4-hour infusion. You come back 2 weeks later for your 1-hour infusion. And it's 1-hour infusion basically approximately every 6 months thereafter. So pretty straightforward. And we think, as you said, no other IV infusion can be given like that. But we do hear from folks that coming back 2 weeks later is not the most convenient thing to do. I mean it is common. RITUXAN is dosed that way. OCREVUS is dosed that way. So it's not uncommon, but it's also not necessarily needed. So we've combined the doses. We're going to run that pivotal trial. We think that study gets up and running in the next month or 2. It should be relatively short enrollment, call it, 6 to 9 months of enrollment. It's a short endpoint. Probably get to the endpoint by middle of next year, give or take. Don't hold me to that exactly, but give or take, middle of next year for that endpoint. Then a filing, I mean, we think we can -- if it goes well and FDA does approve it, we think it could be in the label by the second half of '27. So that will be a nice -- again, it is -- it also is good for the centers. The other thing, scheduling one infusion is hard enough for some of these centers. Scheduling at the same time 2 infusions. So fitting into the matrix on day 1, and then 15 days later, fitting into their matrix for the second infusion does pose some challenges. I mean people get it done. It's not like the end of the world. But it is a nice convenience for them not to have to do that as well. So it's good for the patients, good for the centers. So we think that, that will be a nice addition. You asked me about market research. Our market research says it's definitely incrementally positive. I can't give you the exact numbers. And market research is market research. So I don't think those numbers are exact. But directionally, it appears that, that convenience of just coming in on day 1 and not having to come back 2 weeks later is viewed very positively. The other thing we're working on in terms of the IV experience is we've treated probably close to 100 individuals now with a 30-minute BRIUMVI infusion. So that, too, is something that will -- we're working on what the pivotal trial needs to look like for that. So I can't give you a time line for that one yet. But similarly, again, 30 is apparently better than 60. Pretty straightforward, right? If you can do it in 30 minutes, we hear a lot of folks saying, look, if I could do it in 30 minutes, I could do it at lunch hour. No one even needs to know that I even get the infusion if I do it in 30 minutes. So again, market research said incrementally positive directionally, the right direction for increasing sales and interest. I just -- personally, if we can make it better, whether it changes the market share or not, which I think it will, but if it doesn't, it just makes the experience better. And I think giving patients the option -- again, no one has to do it in 30 minutes. They can do it in an hour. No one has to do it all in 1 day if they want to do it in 2 days. People have a variety of reasons why they might want to do one or the other. I think patient choice, making it as easy as we can and letting them choose is important, which brings me to an extremely important next product, which is the subcu, right? So again, it's all about trying to deliver to the patient what they want, right? So not everyone wants a subcu. Not even the majority of people do, but there is a large minority of folks who do like taking it themselves with an auto-injector at home when it's convenient for them. And so we think that giving them another option -- right now, there's a monopoly in the marketplace. There's literally one product that owns the subcu market. How many times have you guys seen a monopoly work out great for the patient and not as well for the company? Or is it the other way around? Works out great for the company and maybe great for the patient, but maybe not. So we think getting in there and providing competition will be critical and key. And we think, of course, all the attributes of BRIUMVI that are available in the IV and have gotten a lot of people excited mean it will simplify a lot of conversations. For anyone who is a BRIUMVI user and believes in BRIUMVI, if they wanted -- if a patient wants subcu, which is a question that's asked to pretty much all patients when they come in the door, and they only have one option today, if you're an IV BRIUMVI user and that patient walks in the door, I'd say more likely than not, they're not going to get anything about BRIUMVI at that point. So we'll see how it goes. But I do think it's -- it will add another product, more competition. And more competition -- we're trying to do something better in terms of less frequent dosing, and we'll see how that works out.

Excellent. Yes, I do have a question for subcu because you are moving ahead. But just to wrap up the IV, the enhanced kind of regimen. So you don't have the detailed guidance for the time line for the 30 minutes infusion. But should we assume a similar time frame? I mean the structure, the pivotal study like the combined dose for that, shorter pivotal.

Yes. I mean, well, the endpoint will be short because it's probably just a single-dose trial. But honestly, I don't have that design, and we're still working out the details. So I don't want to commit to too much at this point.

Okay. Good. All right. And then let's talk about the subcu because that's one of the potentially even bigger impact to your portfolio because as you said, this kind of enhanced regimen is incremental, but you are creating a new category for yourself for BRIUMVI, right? So -- and my understanding is you already have -- are pretty confident you can do every other month dosing, which is half the dose frequency compared to the current monopoly. Is that true? And then what's the relative development time line for that? And then when we're going to start to see some data? Because people like to see some data.

What do you mean? They don't trust that I'm seeing the data? Come on.

You give us a good example. I got you.

Yes. I know the team is working to put it together, but they're also actively working on adding more information and more data. So we're still gathering information as we come down to the wire. We're doing a lot fast, as I'm sure you can imagine. I mean it's an important new potential product. So right now, in terms of when data will be available, it's either sometime in the second half of the year or sometime in the first half of next year. But in terms of getting the study up and running, again, assuming all goes well, our goal is to get the study up and running in the next 2 months-ish or so. It's probably about a year for enrollment and then give or take another 6 months for the auto-injector bridging component of that. Filing, hopefully in first half, middle of '27. Approval, middle '28 kind of thing. I mean, again, super rough estimates. We got to get the study started. Once we get the study started, then we'll know exactly where we are. But yes, I mean -- and we're still gathering data as we speak, and we're learning bits and pieces as we go. So we're getting close. Probably -- I think we have a quarterly call that will be, give or take, around late July, early August-ish, right? Is that typically when we do that?

Yes.

So I think we'll be in a better position then to have a more fulsome discussion about the plan. We've talked about the study generally being 3 arms. We're going to look at Q2 months and Q3 months. Again, that's where we're sitting today. I don't want to make any promises that that's going to be the final design. But we're getting close, and everything is sort of -- pieces are coming together as we get to the end here to get started. So let me just say it's the best I can do for the moment. We'll have more information coming up soon. But we are excited about the product. We think the profile as we're seeing it today looks quite good.

Yes. I think every time we talk about this topic, it seems the confidence level is a little bit higher because initially, you don't even commit what's the dosing frequency. You say, okay, let's see if we can do every other month, right? I think very clear now you're confident about every other month. Now today, you say -- talk about every 3 months. Still not firm guidance, but that's likely the direction you want to go after.

Yes. Look, I mean, we would love to hit on a quarterly product. We think that it would be just a really nice addition to the armamentarium of the clinicians, and it will be great for patients. But there's a lot of variables that are coming together. So I'll be cautiously optimistic. No promises yet on the program. Let's see where we are in August. I think we'll have a more fulsome update.

Awesome. All right. Good. So I think last quarter, for some reasons, people start to take a look at your profitability and bottom line. You give me some -- probably you talk with a lot of folks as well. So this is not necessarily your near-term focus. So just let us know how your current cash position versus your revenue and your OpEx in terms of the development cost, so how those couple of pieces sustain the long-term growth for TG?

Yes. I mean, over time, my expectation is that the OpEx goes up incrementally. And hopefully, the revenues are gapping up, right? I mean last year, when we did $310 million -- is it $310 million last year? And this year, we're saying, what, $560 million, right? So that's a pretty good jump up. Our expenses aren't jumping up like that. Our expenses went up like 10% or 20%, right? So I think our expenses will go up. And it's also just a function of what we decide to do, right? So we're going to have expenses on the subcu that's basically built in. The expenses for all these ENHANCE programs is built in. We didn't talk about it, but it's -- our work on azer-cel is built in. What's not probably built in fully yet is things we do outside of MS with BRIUMVI, right? So we've talked a little bit about MG. We've only done a little bit there. But I think conceptually, we get it. We're getting more comfortable with it. We're looking forward to seeing how the CD19 launches into that space. So that will help us also decide what we may want to do. We're looking at some other potential indications. So I think -- but those are not -- well, I guess, look, if we go into a pivotal MG study, that's going to cost some amount of money, but it's going to be over 2 years. It's not going to also dramatically change the overall OpEx. And then exploratory studies in a few other indications is also just not going to -- it's going to add to the OpEx, but it's not going to change all that much. So yes, I mean, I think -- and then the wildcard is, look, we are always out there looking for potential opportunities. If we see something we like, for the most part, those will run through R&D. If we acquire a product and then we have to spend money on the product, we've been super cautious about how we've done that. We've acquired one thing in the last bunch of years. So it's -- and we didn't spend a whole lot on it, but it's moving along. So again, I think OpEx is a variable number. But again, it's not going to gap up. The revenues will hopefully be continuing to gap up.

Yes. Yes. No, I think the near-term focus will continue to be driving the top line. And then obviously, you are relatively disciplined on the spend side and just try to get more growth in the future. Right.

Yes, yes. I mean to be honest, I haven't yet looked at a bottom line number. It's not on my radar screen. It's not a number that I track. If I don't track it, then we're not working toward it, right? So we're working toward top line revenue growth and building the business that we want to build. And whatever drops to the bottom line and turns out to be profits, great. We're also -- we -- I'm pretty sure we're buying shares almost every day. Also, that's part of how we're spending our cash right now. So like I said, it is not a metric that I track today, and I don't assume it will be a metric I track for the next several years.

Excellent. Thank you, Mike, for being with us this morning -- this afternoon.

Thanks, Roger. Appreciate it.

Yes. Thank you, everyone.