Blueprint Medicines Q2 2023 Earnings Call Transcript

Quartr
Provided by Quartr
August 2, 2023

There are 17 speakers on the call.

Operator

Good morning, ladies and gentlemen. My name is Glen. I'll be your conference operator today. At this time, I would like to welcome everyone to the Blueprint Medicines Second Quarter 2023 Financial Results Conference Call. All lines have been placed on mute to Results Conference Call.

Operator

All lines have been placed on mute to prevent any background noise. After the speakers' remarks, there will be a question and answer session. Call. I will now turn it to Jenna Cohen, Vice President of Investor Relations to begin.

Speaker 1

Thank you, Glenn. Good morning, everyone, and welcome to Blueprint Medicines Second Quarter 2023 Financial and Operating Results Conference Call. This morning, we issued a press release, which outlines the topics we plan to discuss today. You can access the press release as well as the slides that we'll be reviewing today by going to the Investors section of our website at www.blueprintmedicines.com. Joining me today are Kate Haviland, Chief Executive Officer Selena Lee, Chief Commercial Officer Suwad Namuni, President, Research and Development and Mike Lanzitel, Chief Financial Officer.

Speaker 1

Christy Rossi, Chief Operating Officer and Becker Hughes, Chief Medical Officer will also be available for Q and A. Before we begin, I'd like to remind you that some of the statements made during the call today are forward looking statements as outlined on Slide 3 and are subject to a number of risks and uncertainties. These may cause our actual results to differ materially, including those described in our reports filed with the SEC. You're cautioned not to place any undue reliance on these forward looking statements and Blueprint disclaims any obligation to update such statements. I'll now hand the call over to Kate.

Speaker 2

Thank you, Jenna, and good morning, everyone. In the Q2, we entered a new era of Blueprint Medicines, which we call precision at scale. This inflection is driven by significant near term growth opportunity for AvaChet with the recent FDA approval and ISM. With AvaChet, ISM patients now have the 1st and only medicine approved to treat their disease and importantly, A medicine that was specifically designed to stop ISM at its source. The launch is off to a great start, and Selena will provide more color on our commercial results and key launch metrics shortly.

Speaker 2

Importantly, everything we are seeing in these early days of launch demonstrates that the market for AvaKIT is a blockbuster opportunity that we estimate to be more than $1,500,000,000 at peak. Our Q2 launch momentum has continued into the second half of this year, and Ava Kit is on track to become the durable market leader across the spectrum of both advanced and indolent SM for years to come. At Blueprint Medicines, we have developed a deep knowledge of SM that will allow us to extend and enhance our leadership in this area as we define the direction of innovation going forward. In ISM alone, We have studied approximately 400 patients globally at nearly 80 sites spanning 16 countries. Through our development work, we have built a substantive and rigorous base of knowledge of SM disease biology that will allow us to continue to meet the range of clinical needs across the spectrum of patients who have SM.

Speaker 2

We are developing longitudinal long term evidence on the treatment impact of Avakit in ISM, and we look forward to sharing data from Part 1 of our HARBA study of elanecinib later this year. Beyond SM, we are expanding our leadership in KIP biology as we build a franchise in broader mast cell driven diseases. Today, we are very pleased to announce we have nominated a development candidate targeting wildtype kit, BLU-eight zero eight, which has the opportunity to be the 1st and best in class oral wild type KIT inhibitor with broad applicability across multiple diseases. Fuad will provide more details on this program as well as our other pipeline programs later on the call. But I want to highlight this program as an example of how we are executing our strategy of precision at scale.

Speaker 2

Our wildtype kit program directly leverages our kit technical expertise and our SM commercial and medical infrastructure, which will allow us to work efficiently as we address the medical needs of patients with a wide range of mast cell driven disorders. Precision at scale is our strategy for driving growth through leverage. By efficiently using our resources. We are capitalizing on our first mover advantage in SM and moving quickly into adjacent new diseases, enabling us to operate with financial discipline by leveraging true synergies across programs. Blueprint has a strong financial foundation and Mike will cover how we have managed operating expenses while growing revenue and advancing our pipeline.

Speaker 2

This uniquely positions us to have true options over the coming years to drive value as we prioritize the most promising pipeline programs, utilize partnerships to expand our cash position and stay disciplined and data driven, deprioritizing programs that don't have compelling data or market opportunities. This is our framework to build precision at scale. Our execution across a diverse set of value drivers in the first half of this year has set us on a strong trajectory for continued success moving into the second half of twenty twenty three. Our number one priority will continue to be driving revenue acceleration with the launch of Avakit and SM, while we also progressed our pipeline of programs, addressing some of the most important and exciting biological targets in oncology and allergy immunology that has the potential to impact a large number of patients globally. Now let me turn it over to Felina to discuss Avacat performance in the quarter and our perspectives on the 1st few weeks of ISM launch.

Speaker 3

Thanks, Kate. Good morning, everyone. Our results in the Q2 and for the 1st few weeks of our ISM launch put us exactly where we want to be. We achieved net product revenue of $39,900,000 including $34,300,000 in the U. S.

Speaker 3

We significantly grew the number of patients on therapy, Exiting the quarter with approximately 585 patients on Avakit in the U. S. The growth we saw was fueled by SM, where we saw a significant uptick in June post approval. While our advanced SM business continues to grow, ISM launch is the key catalyst that unlocks Ava Kit's blockbuster potential. Our Q2 results are due to Ava Kit's strong clinical profile in ISM and exceptional execution out of the gate.

Speaker 3

I could not be more proud of our team. We are delivering across the 3 pillars of our launch strategy: engaging with providers, activating patients and ensuring strong access. Let's look at each of these key strategic pillars driving the launch. 1st, we're seeing strong provider engagement. Our field teams have been educating hemox and allergist immunologists on Avakit in IFM, and the enthusiastic response we're seeing confirms the unmet need is there.

Speaker 3

Nearly 70% of SM scripts since approval came from new prescribers, including Hemox as well as allergist immunologists. Prescribing was evenly split between academic and community, which is great validation that providers recognize the strong benefit risk profile of Avakit. What we're seeing in the daily interactions of our field teams with providers across treatment settings aligns well with the overall sentiments you've seen in recent surveys by others. HemOnx and allergists are compelled by Avakit's efficacy and safety profile. They're motivated to prescribe Avakit based on the broad symptom improvement.

Speaker 3

They're identifying the first ISM patients they want to treat and linking to their upcoming appointments through the year. We expect to see a strong and consistent cadence of new patient starts going forward as patients come in for their appointments and have the opportunity to discuss Avakit with their providers. 2nd, we're beginning to see the impact of patient activation on AvaCit prescribing. Patient activation is a critical part of driving urgency to treat. Before launch, We drove disease awareness, partnering with the advocacy community.

Speaker 3

At launch, we unveiled a branded patient campaign, engaging thousands of people in our CRM database. And we're just now launching our broadest multi channel direct to patient efforts to grow awareness of Avakit. An educated patient is a catalyst for treatment. Patients are closest to the hard decisions they've had to make to live with ISM, leading to what some have described as a sense of loss of life while still living. When patients see Avakit's profile, we know they're more likely to ask their provider about it.

Speaker 3

And we're highly encouraged to hear initial examples of patients calling their providers to ask about Avakit. We expect this to grow as we expand our patient activation efforts. And last, access to Avakit continues to be strong. Prescriptions are being written, approved and paid for as we expected. The majority of payer coverage policies have been updated to include Avakit in ISM, which is highly encouraging to see this early in the launch.

Speaker 3

These updated policies provide coverage consistent with Avakit's broad indication. There are no restrictions beyond the label and there are no step edits. We have yet to face any denials and we have seen paid claims at 9 of the 10 biggest payers. Strong access is important to all providers, particularly allergists, who may have had prior negative experiences with other products. So we're not only educating on the clinical profile of Avakit, but we're also educating new prescribers on the access process.

Speaker 3

And most importantly, we're hearing that when a provider has prescribed Avakit, they and their staff are finding the access process to be very easy. Overall, our experience validates exactly what we expected. Q2 reflects just the 1st few weeks of launch performance. And while we don't typically comment past quarter close, I'm pleased to share the strong initial trends we've seen have carried into July. We have the right medicine, the right team and the right capabilities to scale our impact, and we are well on track to establish Avakit as the standard of care in ISM.

Speaker 3

We are executing our plan with precision and it's a thrill to see our vision becoming reality. With that, I'll hand it to Fuad to talk about recent accomplishments in our research and development portfolio, including how we continue to build on our KIT franchise leadership.

Speaker 4

Thank you, Felina. And as Kate mentioned in her introductory remarks, our Blueprint Medicines pipeline shows how we develop precision medicine at scale with the potential to benefit a large number of patients. We have leveraged our leadership position in mast cell diseases and knowledge of Kid Biology to further pursue large on strategy opportunities that significantly scale our precision discovery efforts. I am pleased to announce that we have nominated BLU-eight zero eight as an oral highly potent and selective non brain penetrant wild type kit inhibitor for development in mast cell disorders, including chronic urticaria. Chronic urticaria is a serious skin disorder characterized by hives, itching and swelling and defined by high levels of mast cell activation.

Speaker 4

There are few options for patients who are not well controlled by first line treatments and BLU-eight zero eight represents a significant opportunity to bring relief to many people. Blueprint is uniquely advantaged to bring forward BLU-eight zero eight with its very compelling preclinical profile as a potentially 1st and best in class wild type kin inhibitor. We expect BLU-eight zero eight to be in the clinic in 2024 and look forward to updating you more on clinical development plans as they progress. Turning now to our oncology clinical pipeline, for which we presented promising clinical data this past quarter at ASCO. This included dose escalation data from our eGFR programs with late line monotherapy and combination data of BLU-nine forty five with osimertinib as well as first clinical data for BLU-four fifty one, which we are studying in exon 20 insertions and atypical EGFR mutations.

Speaker 4

Across both programs, we saw opportunity for and we continue those escalation to determine RP2D. One of the biggest takeaways from this year's ASCO was the excitement around emerging data on CDK2, which suggests that this new target will be the focus of medicines that can treat a wide range of intractable solid tumors such as breast cancer. At ASCO, we presented dose escalation data from our CDK2 inhibitor BLU-two twenty two that show this molecule has both good safety profile and early clinical activity to become the best and most combinable molecule in the class. The validation of CDK2 as an important cancer target and the emerging BLU-two twenty two clinical profile increase our optimism about the value that can be created with this investigational agent. We are moving towards monotherapy RP2D and rapidly enrolling patients in the CDK4six combination cohort.

Speaker 4

The next major inflection point for this program will come in 2024, when we expect to share the 1st combination data. BLU-two twenty two embodies our approach to precision at scale, target validation, potent and selective inhibition with best in class agent developed in house and the development plan that aims to rapidly bring the benefits of precision medicine to a large patient populations with medical need. Having worked on major medicines that transformed the treatment of cancer for a large number of patients, I can see BLU-two twenty two becoming one of these. With this, I now turn the call over to Mike to review our financial updates.

Speaker 5

Thanks, Fuad. Earlier this morning, we reported detailed financial results in our press release. For today's call, I'll touch on a few highlights. In the Q2, total revenues were $57,600,000 including $39,900,000 in net product revenues from sales of Avakit and $17,700,000 in collaboration and license revenues. As Felina noted, we saw continued growth in Avocate demand across the SM business.

Speaker 5

Our total costs and operating expenses were $185,600,000 for the 2nd quarter, which includes $23,800,000 and non cash stock based compensation expense. This marks our 4th consecutive quarter of flat or declining operating expenses and a year over year decline of approximately 5% compared to the Q2 of last year. For the second half of this year, we expect operating expenses to remain relatively consistent with what we saw in the first half of the year. Blueprint is at an inflection point for value creation as we expect AvaCit revenues to meaningfully ramp with the ISM launch. As product revenue continues to ramp and we remain disciplined on our operating expenses, We expect our operating cash burn to be lower in 2023 as compared to 2022 and to continue to decline into 2024.

Speaker 5

We remain in a strong financial position with $836,600,000 in cash on hand. Blueprint's continued diversity of fundamental revenue drivers gives us the flexibility to be strategic and thoughtful in how we manage all aspects of our business to provide the greatest value to our shareholders. Looking forward, our highest priorities for capital allocation are investing in the continued launch of ISM and in accelerating and expanding the development of BLU-two twenty two given the potential opportunity to drive value with the best in class CDK2 inhibitor as Fuad highlighted earlier. And we will continue to do this while maintaining a strong financial position. With that, I'll now turn the call back over to the operator for questions.

Speaker 5

Operator?

Operator

Thank We have our first question comes from Brad Canino from Stifel. Brad, your line is now open.

Speaker 6

Great. Good morning and congrats on the initial launch results here. I'd actually like to ask for commentary around the dynamic where 70% of the new scripts were from new prescribers. Because you mentioned before you had 400 hemonc accounts that were prescribing for ASM. And I think they had over 400 ISM patients.

Speaker 6

And I think We would have expected first adoption there. So can you speak to what might be preventing the more rapid uptake there in that prescriber segment? Any insight into July for those? And was there any commentary you can have over higher off label use in that segment before the approval? Thank you.

Speaker 2

Thanks, Brad, for the question. Selena, do you want to talk about, how we're seeing this nice breadth of prescribing coming from both new and existing prescribers? Yes. First off, Brad, I

Speaker 3

think we were really pleased to see the diversity of revenue even this early in the launch where prescriptions are coming not only from hematology oncology where we did see the majority of scripts as expected, but also starting to see some of the first initial Immunology. And so I think to your question about would we have expected more use from existing prescribers, certainly we are seeing use from some of the existing prescribers. I think that skew towards hematology oncology also reflects Their familiarity with Avakit from Advanced FM and other settings. But in fact, seeing this breadth and diversity of prescribing across specialties and across both the academic and the community setting, we think bodes very well for a continued cadence of prescribing, for the foreseeable future. And to the second part of your question about off label use, I can confirm we were not seeing appreciable off label off label use, just a small degree, but not significant prior to the approval.

Speaker 6

Great. Helpful commentary. Thank you.

Operator

Thank you, Brett. We have our next question comes from Dane Leone from Raymond James. Day. Your line is now open.

Speaker 7

Congratulations on a strong launch into ISM. So in lieu of having formal guidance this year, obviously, the dispute is going to be analyzing the various metrics that you provided. And the focus of the metrics that you updated today around having 585 patients on AVA kit at the end of the 2nd quarter gives us a delta of around 65 patients versus what you had stated around 520 at the end of the first quarter. Is it fair to think of that incremental 65 patients as predominantly or entirely coming from ISM and the ISM launch. And does that also Is that also a consistent metric for your commentary around seeing strong trends into July as maybe carrying forward somewhere around that patient add number into the 1st month of Q3.

Speaker 7

And just generally, I guess, maybe expand on how you think that the cadence of adds into the back half of the year as we think about updating our models today. Thank you.

Speaker 2

Thanks, Dane. I mean, I think as we Have talked about before, we have not seen a bolus and we did not see that in this first these early innings of launch. And what we've seen is this kind of strong and steady growth. And And let me hand it over to Selena to talk a little bit more as you think about those numbers, in terms of how we expect that kind of strong and steady growth just to continue throughout the rest of the year.

Speaker 3

Yes, Dane, I think the clearest indicator is in the timing and the fact that we saw most of that uptick occur in June post the approval. In terms of the sort of precise what percentage is ISM, that's something that we won't ever have any perfect visibility into, due to the fact that there's one code, the channels that we distribute through. I think we can say That early out of the gate, most of the new patients starts had already converted, to 25 milligrams. We were really encouraged to see that bump in prescribing that happened in June. And based off of that, we would expect Strong, steady and consistent growth for the foreseeable future.

Speaker 4

Can I ask one follow-up question

Speaker 2

Yes, please go ahead, Dane?

Speaker 7

Okay, great. Going into this launch, there had been discussion around metrics of the patients in ISM having a potentially different SKU in terms of payer coverage and whether it be commercial and or Medicare or Medicaid. Are there initial trends with launch and the 25 milligram scripts consistent with your expectations going into the launch and also for what we've seen so far, the number of patients that would be going on free drug, is that also consistent with what you were expecting for the launch. Thank you.

Speaker 2

Thanks for the question. It was very early days to really kind of see an impact in share mix at this point. But we do expect that the ISM patients will skew more to the commercial side of the business.

Speaker 3

Yes, I think based on the ISM patient demographics, There are they trend towards, some of the younger patients. So over time, we may expect to see sort of a greater shift towards commercial less Medicare. I think your question around the 25 mg and just to clarify that, that is actually a dosage strength that is used across both advanced SM with dose reduction as well as with ISM. But to your question about payer mix, I think no significant changes. Regarding free drug, we have while we did see a higher proportion of patients on free drug in first quarter.

Speaker 3

That has largely unwound to what we had seen as a baseline by Q2.

Speaker 2

So we'd expect the free drug percentage to stay pretty system at this point, Dane, put through this year.

Speaker 7

Excellent. Thank you. Congratulations.

Operator

Thank you. Our next question comes from Randy Benjamin from JPM Securities. Randy, your line is now open.

Speaker 8

Great. Thanks for taking the questions and congratulations on a great quarter. I guess just a couple of your how many physicians have you been able to get in front of during this 1st month of launch. And Filomena, you had mentioned direct to consumer efforts are being employed. I think you mentioned in the prepared remarks, multichannel.

Speaker 8

Can you talk a little bit about what that looks like? And And how long do you think it will take to for you to know how effective those efforts will be? Thanks.

Speaker 2

Thanks for that question, Ron. And I think we've been exceptionally pleased with the access and the physician engagement we've had to date.

Speaker 3

Selena, do you want to kind of qualify that? Yes. We're really excited to just see the enthusiastic reception from both hematologists, oncologists as well as an allergist. In fact, Even just in the 1st several weeks of launch, we've been able to engage similar number of providers as the 1st sort of 8 or 9 months in the Advanced SM launch by comparison. So our field team are clearly out there working tirelessly.

Speaker 3

As you've seen, I think in some of the survey results, as well as reflected in our initial prescribing, the Avakit profile has been extremely well received by these providers. To your question about direct to patient and so these are multi channel efforts that we'll be rolling out Our branded patient campaign across all of the channels where ISM patients are looking for information, including a lot of the online channels. And we know that when patients are aware of Avakit, they are much more likely to ask their providers about Avakit. And so we'll be looking primarily to that continued and increased cadence of adding new patient starts as a result.

Speaker 8

Thanks for taking the question.

Operator

Thank you. Our next question comes from Yu Yan from Jefferies. Yu Yan, your line is now open.

Speaker 9

Thank you. I have just a quick question for Mike. Mike, if I heard you correctly, you said OpEx So it will be lower in 2023 compared to 2022. Does that mean your R and D would continue to decline for the remainder of the year. And another quick question is on the collaborative revenue, including royalties.

Speaker 9

It was about $18,000,000 in second quarter and should you use that as a run rate for the remainder of the year? Thank you.

Speaker 5

Great. Thanks, Eun, for the question. Just to clarify, so the comment I made, with respect compared to 2023 2022, that was with respect to our cash burn. So just breaking that out, as we see revenues continue to rise with the strong ISM launch, we are also seeing our OpEx Maintain be flat basically. Over the last several quarters, we expect OpEx to remain flat going forward.

Speaker 5

Putting those together that leads to a decline in cash burn. So just to clarify that first question. With respect to collaboration revenues, yes, we saw about $18,000,000 in this quarter. A big chunk of that was due to milestone and royalty payments received from CStone this quarter. As we said earlier in the year, we expect our guidance for collaboration revenues for the full year to be between $40,000,000 $50,000,000 Right now, we're just over $40,000,000 year to date.

Speaker 5

We actually are going hold to that guidance on collaboration revenues. And so we expect some incremental revenue largely just driven by royalty payments The remainder of the year, but I think I'd refer to our guidance to help think about the remainder of this year.

Speaker 9

Thank you.

Operator

Thank you. With our next question comes from Mark Brown from TD Goen. Mark, your line is now open.

Speaker 10

Thanks for taking my questions and congrats on the progress on the launch so far. Maybe for Phil Nunez, just Any patterns that you're seeing emerge of the patients coming on therapy in terms of the level of disease severity, The specific symptoms that they're experiencing that may kind of point to who are the early adopters?

Speaker 2

Yes. Thanks for the question, Mark. Felida, do you want to comment on the range of patients we're seeing?

Speaker 3

Yes. So I think as we expected, the first patients that we're seeing coming on to therapy tend to be on the more moderate to severe end of the spectrum. I think one way that we hear providers talking about it is just that these are patients who are not well controlled or not adequately controlled despite these symptom directed treatments. So exactly as we expected. And I think encouragingly, what we also see is the recognition of medical need Beyond those patients into the so called milder patients.

Speaker 3

And so we expect with first experience that adoption will expand as providers broaden the lens of who's an appropriate patient.

Speaker 10

Okay, great. That's helpful. And then You're working very early days and clearly patients haven't gotten to these standards quite yet. But what are you expecting in terms of potential reauthorizations and things like that, Great. You're not seeing a lot of step edits and things like that for the initial prescription, but in terms of reauthorizations maybe 6 months out.

Speaker 3

Yes. I mean, we don't have any signs of that to date. I mean, I think overall the access story is resoundingly strong, and we're really encouraged, to really see all of the strong initial metrics, right, coverage to label the majority of payer policies, already updated, no denials, no step edits. And certainly, we don't see any signals of any types of attestation or additional information that are needed beyond the label.

Operator

Thank you. Wealth. Our next question comes from Salveen Richter from Goldman Sachs. Salveen, your line is now open.

Speaker 11

Good morning. Thanks for taking my question. So I think you're very much implying that the uptick in June is related to ISM. But as we kind of think of this trajectory in the forward, is there anything quantitative you can give us like in terms of the proportion of 70% new prescribers that are ISM versus advanced SM or understanding who's coming from a where these prescriptions are coming from, Whether from a hemonc or non hemonc setting. And then just remind us, you'd always suggested no bolus, but also talked about the lag that would occur from when a patient has to request treatment and has to kind of slot themselves into the physician office.

Speaker 11

Can you just walk us through this as we think about at least next quarter?

Speaker 2

Yes. Thanks for the question, Salveen. So As we've talked about before with the single diagnosis code, you were never going to have perfect visibility on who's an ISM patient, who's an advanced SM patient. Our dosage strengths are used across both, and so we can certainly look at the 25 milligrams. And as Felina was mentioning, we saw a really nice step up in June, particularly driven by patients being prescribed 25 milligrams.

Speaker 2

So that is likely these are the ISM patients who are coming on the therapy upon approval. And I think you can take we've been giving numbers on patients at end of quarter now for this is our 3rd quarter. So you can see some base business growth coming from the end of last year into the end of Q1. And then you can see the growth now in Q2. And I think you can do some straight lining math That's probably pretty straightforward and simple as you think about the rest of the year.

Speaker 2

And then ISM patients are seen by both hematologists, oncologists and allergy immunologists. There's not a way to easily split by prescriber. But, Flynn, I don't know if you have anything else to add.

Speaker 3

Yes. I mean, I think to your question about sort of the cadence and what to expect, I mean, just sort of Stepping back, we're really excited, I think, to just sort of confirm our expectations of the ability to find patients that the need is there, The providers are really recognizing the benefit of Avakit's clinical profile that they are readily identifying the first ISM patients they want to treat. And so from that point forward, it's simply that cadence of being able to speak to those patients at their subsequent SM appointments. And so based on that, we would expect strong, steady and continued growth for the foreseeable future.

Speaker 2

Thank

Operator

you. With our next question comes from Michael Schmidt from Guggenheim Partners. Michael, your line is now open.

Speaker 12

Hey, thanks guys for taking my questions. I think the AVA kit dynamics Sounds pretty clear now that you're expecting a steady flow of new patient adds there with a similar cadence, it sounds like, from what we've seen at the end of the second quarter, but then maybe just a quick pipeline question on the upcoming HARBR trial for BLU-two sixty 3 in ISM. I think you mentioned in the past a pretty high bar for this asset to advance, but maybe help us understand sort of what degree of From AVA kit, you need to see in the study in order to advance this asset into advanced trials.

Speaker 2

Thanks, Michael. And yes, we're very happy to see the strong and steady growth in ISM and great to get a question on the pipeline. So, Well, would you like

Speaker 4

to take that? Thank you, Michael. I mean, as Selena mentioned, which is the best proof of the bar, the high bar that apapritinib has given is The reception by the physician community whether in hemonics and allergy treating ISM patients, the efficacy is very strong. The safety profile is really very good one for chronic therapy. So the bar is very high in the for treating ISM given what we are achieving with Avapritinib now.

Speaker 4

And as we guided and committed, we will report the data from harbor Part 1 this second half of the year. But I again, we are very, very pleased with the profile of AVAcid and how patients are

Operator

benefiting from it. Thank you. Our next question comes from Amy Fadia from Needham. Amy, your line is now open.

Speaker 9

Hi, good morning. Thanks for taking my question. Perhaps another one on line. Can you give us an update on BLU-two twenty two, where you are in the dose escalation? And and perhaps give us a sense of when we might be able to expect data and what you're looking to achieve in terms of the target dose?

Speaker 9

Thanks.

Speaker 4

Thank you, Amy. This is Huwad. I think BLU-two twenty two is probably one of the most important targets that we see that actually personally have been in drug development for some time and I see this becoming a key potentially medicine for patients with cancer, starting with breast cancer, hormone positive breast cancer. At Blueprint, with our strategy of precision medicine at scale, we are able to make a highly potent and selective molecule. Today, when you look at the profile of BLU-two twenty two within its class, It is the best in class.

Speaker 4

It has efficacy data that's where I started seeing signals of clinical activity. It has a very good safety profile that makes it very combinable with other agents within CDK4six. So we see this really very good start of development of this major potentially major medicine for patients. Where we are in terms of development, I think we are working towards determining the recommended Phase II dose for the monotherapy on one hand. On the other hand, we are really accelerating and the recruitment in the combination cohort of BLU-two twenty two and ribociclib CDK4six with breast cancer target in mind.

Speaker 4

The plan is to generate safety data. We'll be able to really talk about these data next share. We'll give much more precise guidance when we are closer to that. But I think the idea is really to go very quickly with good data to a development plan that in breast cancer that includes second line building on background hormone therapy, CDK2 and CDK4six combination and the same for first line breast cancer. We do also have a branch that is in the program that is focused on an enrichment strategy with CCNE1 amplification, education and we are looking at ovarian cancer in particular and some endometrial cancer too, where we do monotherapy and combination with carboplatin in that part of the development.

Speaker 4

More to come next year, but I think this is probably in the oncology pipeline, one of

Speaker 2

guidance. Thank

Operator

you. With our next question comes from Mike Hughes from Morgan Stanley. Mike, your line is now open.

Speaker 13

Good morning, everyone. Thanks for taking the question. Maybe just a quick follow-up just on ISM launch impact And maybe specifically related to the diagnosis rate you're seeing out there and if the launch has had any impact yet? And if not, when do you think that might start to happen? Thanks.

Speaker 2

Yes. Thanks. Palinda, do you want to touch on the growing diagnosis?

Speaker 3

Yes. Thanks for the question, Mike. I think we're really encouraged in fact, to as we've been focused on disease awareness over the past many years I think working with advocacy community that we have seen diagnosis rates increase continually through that and we do continue to see those diagnosis rates increase through the launch. That represents I think an important driver of medium to longer term growth for the opportunity.

Speaker 13

Great. Thank you.

Operator

Thank you. Our next question comes from Matt Spiegler from Oppenheimer. Matt, your line is now open.

Speaker 14

Hey, guys. Good morning. Thanks for the question. Maybe a controversial one, but are you hearing any evidence of clinicians earmarking There are more advanced patients for a clinical trial over prescribing commercial Avakit. Obviously, there's at least one other large ISM trial out there recruiting.

Speaker 14

Are you just hearing of any headwinds from that?

Speaker 3

No, I can't say that we're hearing of those types of headwinds. I mean, I think with commercially available therapy and the urgency to Treat these patients who are really not well controlled. We have conversations with providers as well as these centers of excellence and potential investigators, but I think in total, we're seeing very strong recognition of AvaKits efficacy and safety profile as well as the need to be treating these patients.

Speaker 2

It's also much easier for patients. I mean, we have very robust patient assistance programs. Our patients do not experience significant out of pocket or kind of burdens. And so from a patient's perspective, you'd be able to access a commercial therapy rather than participate in a protocol or trial is a much more patient friendly opportunity.

Speaker 4

Makes sense. Thanks.

Operator

Thank you. As our next question comes from Peter Lawson from Barclays. Peter, your line is now open.

Speaker 15

Thank you. Thanks for the update. And quarter. I wonder if you just talk about the dynamics of free drug this quarter if it's changed since 1Q and if that affects both ASM and ISN patients. And then kind of few expectations of where you think the number of ISN patients could get on treatment by year end?

Speaker 4

Thank you.

Speaker 2

Yes. Thanks, Peter, for the question. As we said, the percentage of free drugs has historically been around 30%. We expect that continue through the course of this year. It will change over time as more and more ISM patients do come on, but through the course of this year, we expect that to be about the same.

Speaker 2

We did have that free drug benefit in Q1 that has completely unwound. So that is, we knew that was a temporary benefit. That's why we split that out in Q1 for you all. And then I think your second question in terms of kind of guiding to the number of patients, I think Selena made some commentary that we We continue to see really strong momentum in July. We would not normally give any type of indication on a quarterly basis, but On a monthly basis, we do stick to quarterly results.

Speaker 2

But given the fact that the ISM launch was really kind of 1 month of the last quarter, We wanted to make sure to provide some commentary to say that we've seen that really nice strong momentum continue through July, which we're very excited to see. And we'll be happy to update you on patients on therapy at the end of Q3.

Speaker 15

Perfect. Thank you. Do you think you'd be able to break it out for prescribers,

Speaker 3

Yes. So I would say, as we've said, we're really encouraged to see the diversity of prescribing out of the gate. That as expected the initial prescribing is weighted more towards hematology, but also highly encouraged to see the first Allergist Immunologists come on to the Board and we expect that to grow over the course of the year.

Operator

Thank you. With our next question comes from Derek Archila from Wells Fargo. Derek, your line is now open.

Speaker 8

Hey, good morning and thanks for taking the questions. Congrats on the progress. Just two brief ones from us. Can you just help quantify the change in channel inventory for the 25 mg dose from 1Q to 2Q. And then just a follow-up to Brad's earlier question.

Speaker 8

I guess, What's the biggest thing you can do to activate the current prescribers of Avakit using it in ASM that have not yet prescribed it for ISM in the future quarters? Thanks.

Speaker 2

So in terms of the change in channel is Very easy. We've not seen any meaningful change there at this point, Derek. So that's an easy question. And then, Plena, do you want to talk about kind of the current AvaKIP prescribers? I mean, I think this is not a dynamic about activating them.

Speaker 2

This is really about that cadence of when they see ISM patients. Honestly, Derek, but I don't know if that's going up there.

Speaker 3

Yes. I mean, I think, just to be really clear, our team is targeting not only the prior prescribers who are a portion of that market based on advanced SM experience, but also targeting much broader providers including moving into allergy and immunology and using a suite of tools, local market intel, claims data, patient journey data to be really thoughtful to be engaging where patients are engaging with their providers. And so as a result of that, we would expect diversity of prescribing as a strong signal and lead indicator for continued growth in the market. We would feel very differently out of the gate if this prescribing were concentrated in experienced prescribers or a smaller number of centers. We're highly encouraged to see this breadth of the prescribing and expect that growth to continue.

Speaker 2

And one of the things we've seen today, Derek, is that when a physician and a patient have a first clinical experience that really widens their aperture to accelerate the next set of patients they get on therapy. So to Felina's point, having that increased press with new prescribers coming on rapidly, it bodes very well for a foundation for that continued strong and steady growth.

Operator

Thank you. With our next question comes from David Lebovitz from Citi. David, your line is now open.

Speaker 16

Thank you very much for taking my question. Understanding that ASM patients use all doses, could you give us a little perspective on how the 25 mg dose usage might have changed. Has there been an uptick in prescriptions for that particular dose and any way you can quantify that? And one additional question. On the physicians you are currently reaching out to, what proportion of those physicians have in the past prescribed Ava Kit for ASM patients and has that number of patients that proportion expanded since the ISM launch.

Speaker 2

Yes. Selena, do you want to talk about the dynamics of the 25 milligram shows. And then also I think your second question, David, is around how many experienced already APK experienced physicians have been prescribing.

Speaker 3

Yes. So I think as we said, the 25 mg now in fact comprises most of the new patient start doses that we're able to See through our channels. I think to the second part of your question, again, as we said, 70% are new prescribers, meaning The remaining 30% are prescribers, who have had prior Avacad experience. I think just sort of Stepping back from all that, we could not be, I think more encouraged by where we are by the breadth of prescribing and what that bodes for the continued success of the launch.

Operator

Thank you. Our next question comes from Joe Bitti from Baird. Joel, your line is now open.

Speaker 13

Hi, thanks for taking the question. In the prepared remarks, I think you mentioned that you have to have any denials. Can you just discuss how long it typically takes for payers to make that decision and if that's changed at all since the ISM launch?

Speaker 3

Yes. So I think access has been incredibly strong and smooth, continued point of strength for Avakit and that continues to be the case throughout the launch. We're thrilled with the level of open access that we're seeing. Not only I think the ease of the process, but also the speed of the process continues through ISM.

Speaker 13

Okay. Thanks.

Operator

Thank you. We have no further questions on the line. I will now pass Feedback to Kate for closing remarks.

Speaker 2

Thank you, operator, and thanks everyone for taking the time to join us today. Our year to date results provide a strong foundation for growth and significant upside for us as we move through the course of this year. We look forward to continuing to update you on our launch progress and we hope everyone has a great rest of their summer.

Operator

Thank you. Ladies and gentlemen, this concludes today's call. Thank you for joining. You may now disconnect your lines.

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Key Takeaways

  • Ayvakit launch in ISM off to a strong start with $39.9 M in Q2 net product revenue, ~585 U.S. patients on therapy, and early momentum carrying into July, supporting a >$1.5 B peak opportunity.
  • 70% of ISM scripts came from new prescribers across hematology-oncology and allergy/immunology, with broad payer coverage—no denials, label-consistent policies, and no step edits to date.
  • Precision-at-scale strategy leverages Blueprint’s KIT expertise to nominate BLU-808, a first-in-class oral wild-type KIT inhibitor for mast cell-driven diseases like chronic urticaria, expected in clinic in 2024.
  • Oncology pipeline advances include dose escalation of EGFR programs (BLU-945, BLU-451) and promising clinical activity and safety for CDK2 inhibitor BLU-222, moving toward RP2D and CDK4/6 combination cohorts with first data in 2024.
  • Financial discipline sustained with four consecutive quarters of flat or declining operating expenses, Q2 operating cash burn on track to fall in 2023 vs. 2022, and $836.6 M cash on hand to fund ISM launch and high-value R&D.
A.I. generated. May contain errors.
Earnings Conference Call
Blueprint Medicines Q2 2023
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