NovoCure Q2 2024 Earnings Call Transcript

Quartr
Provided by Quartr
July 25, 2024

There are 14 speakers on the call.

Operator

Good day and thank you for standing by. Welcome to the Novocure Q2 2024 Earnings Conference Call. At this time, all participants are in a listen only mode. After the speakers' presentation, there will be a question and answer Please be advised that today's conference is being recorded. I would now like to hand the conference over to your speaker today, Ingrid Goldberg.

Operator

Please go ahead.

Speaker 1

Good morning, and thank you for joining us to review NovaCare's Q2 2024 performance. I'm joined this morning by our Executive Chairman, Bill Asoyle our CEO, Asaf Danziger and our CFO, Ashley Cordova. Other members of the executive leadership team will be available for Q and A. For your reference, slides accompanying this earnings release can be found on our website, www.novacare.com, on our Investor Relations page under Quarterly Reports. Before we start, I would like to remind you that our discussions during this conference call will include forward looking statements and actual results could differ materially from those projected in these statements.

Speaker 1

These statements involve a number of risks and uncertainties, some of which are beyond our control and are described from time to time in our SEC filings. We do not intend to update publicly any forward looking statements except as required by law. Where appropriate, we refer to non GAAP financial measures to evaluate our business, specifically adjusted EBITDA, a measure of earnings before interest, taxes, depreciation, amortization and share based compensation. We believe adjusted EBITDA is an important metric as it removes the impact of earnings attributable to our capital structure, tax rate and material non cash items and best reflects the financial value generated by our business. Reconciliations of non GAAP to GAAP financial measures are included in our press release, earnings slides and in our Form 8 ks filed with the SEC today.

Speaker 1

These materials can also be accessed from the Investor Relations page of our website. Following our prepared remarks today, we will open the line for your questions. I will now turn the call over to our Executive Chairman, Bill Doyle.

Speaker 2

Thank you, Ingrid, and good morning. Our mission at Novocure is to extend survival in some of the most aggressive forms of cancer through the development and commercialization of our innovative therapy tumor treating fields. We have built a strong foundation treating glioblastoma and with an anticipated approval to treat second line non small cell lung cancer, we are on the threshold of helping many more patients in need. As we approach this year's milestones, the urgency of our mission is even greater for the entire NovoCure team. Entering 2024, we identified 3 key objectives which would best position us for success this year and beyond.

Speaker 2

1, to grow our commercial business in glioblastoma 2, to launch TTField therapy in non small cell lung cancer and 3, to deliver on the promise of our clinical and product development pipeline. These objectives are ingrained in our business units and have been rallying points for our global teams. I am pleased to share that we are making significant progress on all three And with the focus and dedication of the entire Novocure team, we believe we can deliver on all 3 in 2024. This morning, we will review our progress on each objective, review our financial performance and then open the line for questions. We ended the 2nd quarter with 3,963 active patients on therapy, our highest number of active patients since commencing commercial operations.

Speaker 2

Our French GBM launch, now in its 5th quarter, continues to be a tailwind. France serves as a blueprint for a successful launch employing our new synchronized commercial structure, a blueprint we will leverage in future expansion across the big 5 EU markets. Real world evidence of the benefits of TTP field therapy is a key resource for engaging with prescribers. In June at ASCO, Doctor. Olivier Barr of the General Hospital Aschattenburg, Alenote presented top line data from the TIGER trial.

Speaker 2

TIGER examined TTField therapy in the routine clinical care of newly diagnosed GBM patients in Germany. TIGER is the largest prospective non interventional TK Fields trial completed to date. Doctor. Barr reported a median overall survival of 19.6 months and median progression free survival of 10.2 months, corroborating the leading survival outcomes observed in our Phase III EF-fourteen trial. Last month, in the Journal of Neuro Oncology, Doctor.

Speaker 2

Murgala of the Mayo Clinic published updated findings from a post marketing safety analysis of over 25,000 TT Fields patients. Doctor. Margalla's analysis confirmed that TT Fields therapy was well tolerated and that no signs of additive systemic toxicity were detected in the patient population, corroborating the safety findings of the EF-fourteen trial. In April, in the journal BMC Cancer, Doctor. Kumpheker of Northwestern published a qualitative review of key factors driving patient adoption of Optune GEO for the treatment of GBM.

Speaker 2

Doctor. Kumpthakar's team found that the 2 most influential drivers for adoption are knowledge of Optune's proven survival benefit and the treating physician's opinion. Real world evidence from trials like TIGER and Doctor. Murgala and Kuntakar's analyses are important additions to the ever growing body of studies supporting Optune GEO for the treatment of GBM, and they underline our commitment to generate and share data with physicians to support and broaden the adoption of TK Fields. We are also focused on product development to improve the patient experience.

Speaker 2

We have rolled out our next generation arrays in our key European markets and patient feedback continues to be positive. We submitted a PMA supplement to the FDA in December and expect a decision from the FDA later this year. After approval, we will commence U. S. Rollout.

Speaker 2

Our team is working on improvements to the digital experience for prescribers and patients with the goal of providing dashboards to streamline patient starts and optimize usage and persistence. We believe our fully aligned commercial approach supported by real world evidence and digital innovation will help to drive strong commercial performance in the second half of the year. Our second key objective this year is the approval and launch of Optune Lula for the treatment of metastatic non small cell lung cancer. Regulatory submissions have been filed and we are engaged with authorities in all of our major markets. As a reminder, prior to our May earnings report, we had recently completed our 100 day meeting with the FDA with no indication that the PMA will be referred to a panel.

Speaker 2

To date, a panel has not been requested and our expectations remain unchanged. We eagerly await the FDA's decision later this year. In Europe, we are waiting for CE Mark approval. The new MDR process in Europe has lengthened timeline and we continue to engage with new reviewers at TUV Rheinland, our EU notified body. While the review process has taken longer than originally projected, our expected outcome has not changed and we anticipate a final decision in the second half of twenty twenty four.

Speaker 2

Internally, our German and U. S. Lung teams are hired and are preparing to launch immediately following regulatory approval. We plan to treat patients in the U. S.

Speaker 2

And Germany as soon as possible following approval using a named patient reimbursement process with additional country launches expected next year. Non small cell lung cancer represents the next major step forward in the NovoCure story and we are eager to pursue this opportunity. Assaf will now review our clinical progress in the quarter.

Speaker 3

As Bill mentioned, our 3rd key objective this year is to deliver on the promise of our pipeline. This quarter, we made significant progress towards achieving that goal across our clinical programs in GBM, non small cell lung cancer and pancreatic cancer. We have reached a key milestone in our non small cell lung cancer program. Last month, Doctor. Minesh Mehta of Baptist Health South Florida presented data from the Phase 3 METIS trial at the ASCO Annual Meeting in Chicago.

Speaker 3

METIS evaluated the use of TTField therapy with best supportive care for the treatment of brain metastases from non small cell lung cancer. METIS met its primary endpoint, demonstrating a median time to intracarnial progression of 21.9 months in the TT field arm compared to 11.3 months in the control arm. A positive trend in the majority of assessed quality of life scales was also measured, and there was no evidence of worsening cognitive function in the TT field arm. Consistent with prior clinical trials, TT field therapy was well tolerated with no additive systemic toxicity. Final analysis of the METIS trial data is ongoing.

Speaker 3

We intend to publish the data in a peer review journal later this year. We have expanded our non small cell lung cancer clinical program to include another registrational Phase III trial, LUNAR-two. LUNAR-two will explore TTField's use with pembrolizumab and platinum based chemotherapy in first line metastatic disease. This trial is open and enrolling at initial sites, and we are focused on expanding the clinical footprint. We are also in the process of opening a Phase 2 pilot trial, LUNAR-four.

Speaker 3

This trial will evaluate immunotherapy retreatment in metastatic non small cell lung cancer. Turning to KEYNOTE-thirty six, we are evaluating appropriate next steps for this trial, given its pace of enrollment and our focus on LUNAR-two. Our GBM program includes 2 additional registrational Phase III trials, Trident and KEYNOTE D58. Trident is exploring the use of OptumGEO concurrent with chemoradiation. If Trident is successful, we will work to expand our label and enable physicians to prescribe TTField therapy several months earlier with chemoradiation rather than after chemoradiation as is indicated today.

Speaker 3

Trident is fully enrolled and will read out in 2026 once follow-up is complete. We are also preparing to open KEYNOTE-fifty eight. KEYNOTE-fifty eight will explore the addition of pembrolizumab to titafil's antimozolomide in GBM and builds upon the promising results of the to the top Phase II trial conducted by Doctor. David Tran. Finally, we are nearing an important readout in our pancreatic cancer program.

Speaker 3

In the Q4, we expect to announce the top line data from the Phase III PANOVA 3 trial, which is starting TTFields together with gemcitabine and am paclitaxel for the treatment of first line locally advanced pancreatic cancer. We are also currently enrolling patients in our Phase II PANOVA IV trial. This trial is exploring the use of atezolizumab with tt fields, jamsitabine and non paclitaxel in metastatic pancreatic cancer. Pancreatic cancer is a devastating diagnosis with 5 year survival rates of 10%. We are eager to learn more about the potential benefits of using TTFields in the treatment of this aggressive disease.

Speaker 3

So far this year, we have reached one successful Phase III readout in METIS and are hopeful for a second in PANOVA 3. We are awaiting potential regulatory approvals in lung cancer, and our solid commercial GBM business continues to fuel additional R and D initiatives. We are launching several new clinical trials this year that have the potential to expand TTField's use dramatically. We are pleased with our progress this year and are eager to continue pursuing our goal to deliver the promise of the clinical pipeline. I look forward to providing further updates later this year.

Speaker 3

Ashley will now review our financial performance for the Q2.

Speaker 4

Thank you, Asaf. The Q2 was a period of consistent execution as we drive towards our 3 key objectives for 2024. Our GBM business turned in the best quarter to date. We are laying the groundwork to launch in non small cell lung cancer and we continue to purposely invest in clinical research and product innovation. Walking down the P and L, we generated $150,000,000 in Q2 net revenue, an increase of 19% year over year and ended the quarter with 3,963 active patients on therapy, an increase of 11% year over year.

Speaker 4

The French market continues to be a tailwind to growth and contributed $14,000,000 in net revenue this quarter with 369 active patients. We also continue to see a benefit in average selling price from improved approval rates in the United States. I want to call everyone's attention to 2 important points on the revenue model. Beyond the benefit in period, improved approval rates in the U. S.

Speaker 4

Generated a $5,000,000 benefit in Q2 net revenues from prior period claims. In addition, we received $3,000,000 in Q2 net revenues from a private payer in the United Kingdom, where payments are not yet routine. We do not expect these two benefits totaling $8,000,000 to recur and would remove them from baseline expectations when projecting future revenue. Gross margin for the Q2 was 77%. SG and A expenses totaled $94,000,000 in the quarter, a decrease of 5% year over year.

Speaker 4

This decrease was primarily driven by lower personnel expenses and support functions, which more than offset our continued investment in sales force expansion ahead of a non small cell lung cancer launch. Research, development and clinical trial expenses totaled $55,000,000 in the quarter, in line with the same period in 2023. Our net loss for the 2nd quarter was $33,000,000 or $0.31 per share. We ended the quarter with cash and short term investments of $951,000,000 This quarter, we saw positive adjusted EBITDA of $1,000,000 an increase of $28,000,000 from the same period in 2023. While this was in part due to the one time revenue contributors, we also saw material benefits from reduced operating expenses resulting from the strategic restructuring we undertook at the end of 2023.

Speaker 4

As we actively invest for growth, profitability remains a critical goal for us at Novocure and something we are actively driving towards. I would like to close this morning by highlighting one of our Optune Geo users, Marino do Reienzo. Marino began using Optune GEO in January 2022 following devulking surgery. A father of twin adult sons and a grandfather of 3, Marino prides himself on living an active life and was eager to get back on his feet as soon as possible after his GBM diagnosis. Marino was able to integrate Tumor Training Fields therapy into his daily activities quickly and was soon back on the baseball field with his sons and playing golf with friends.

Speaker 4

Merino is the embodiment of living each day to the fullest and a great reminder of what's at stake in extending survival for our patients. It is so fulfilling for our colleagues to be able to help Marino and his family, and I'd like to personally thank Marino for allowing us to be a part of his journey. With that, we will open the call for your questions.

Operator

Thank you. Our first question comes from Jonathan Chang of Leerink Partners. Your line is open.

Speaker 5

Hi, guys. Thanks for taking my questions. Can you give us an update on the LUNAR regulatory process in Germany and the U. S? You mentioned a new process in Europe, I believe.

Speaker 5

Could you give us additional color on that front? And finally, could you just confirm your current thinking on timelines both Europe and the U. S? Thank you.

Speaker 2

Sure, Jonathan. Good morning. This is Bill. So as we stated in the prepared remarks, our expectations with respect to approvals in Europe and the U. S.

Speaker 2

Have not changed. The FDA timeline also remains unchanged. And importantly, in the U. S, we still believe there will not be a panel. We have not received any indication, as we mentioned in the 100 day meeting that we had or subsequently that the PMA will go to panel.

Speaker 2

In Europe, it's not a new process for us. It's a new process for Europe called the MDR process that has to some degree lengthened the timing from submission to approval for everyone in the medical device space. Initially, we had projected an approval in the first half. We're actively interacting again, as we mentioned, with our notified body, and we now expect that to occur in the second half. So that's the only change.

Speaker 5

Understood. Are you able to elaborate on the NDR process? Are there like what are the boxes that need to be checked?

Speaker 2

Yes. So we never talk about the specific back and forth other than to say it's constructive. And again, we don't expect we still expect the same outcome. We just expect it to be a little later in the second half.

Speaker 5

Understood. Thanks for taking my questions.

Operator

Thank you. Our next question comes from Jason Bednar of Piper Sandler. Your line is open.

Speaker 6

Hey, good morning. Nice quarter, everyone. A couple of questions to start from us. We wanted to focus first on maybe the commercial side. The U.

Speaker 6

S. Active patient number improved sequentially for the first time in a year. That was good to see. Can you talk about the sustainability of this type of improvement? How do you build upon that going forward?

Speaker 6

Or should we more simply think of this active patient number remaining around 2,200 patients or so going forward? And then Ashley, I think you also said that your payer approval rates continue to improve in the U. S. How would you have us think about U. S.

Speaker 6

Revenue in the context of that comment? Does your revenue algorithm change near term or revenue per patient change near term and how we calculate and model that out?

Speaker 7

Hi, Jason. This is Frank. Thank you for the question. Appreciate the note on the commercial performance. Yes, we are 1st, just looking globally before I come to the U.

Speaker 7

S, we're really pleased that we've now approached 4,000 patients on therapy worldwide and that is a high watermark for us. With respect to the U. S, what we have been able to do is to return the active patients to sequential growth from year end, as you noted. And as a reminder, at the end of last year, we did realign our organization so that our teams have a focus our commercial teams have a focus not just on driving demand as measured through prescriptions coming in, but really have a comprehensive plan to then convert prescriptions to starts and then ensure that the patients can stay on therapy to enjoy the full benefit of the therapy. So I think what you've seen in the numbers last two quarters is our ability to tighten up operations and to really ensure that we do maximize the value of each prescription coming through and maximize the benefit to the patient.

Speaker 7

As you know, we don't give guidance looking out into the future. So I won't comment specifically on where we see this number going. But I'll remind you as always that we do believe there are more patients who can benefit from the therapy. And as an organization, we're committed in all of our markets to ensuring that we drive growth and help the most number of patients possible.

Speaker 8

Great. And Jason, this is Ashley. I'll jump in with some commentary on the net revenue per patient. You heard us clearly call out $8,000,000 from this quarter's net revenue, which we believe essentially are I don't like the one term in nature because fundamentally, its improvement in approval rate is recurring, but the benefit in the quarter, we get both the catch up benefit and the end quarter benefit. If you take that $8,000,000 out of the Q2 net revenues, you can then use that net revenue per active patient number projecting forward in the model.

Speaker 8

And specifically in the U. S, which is where you see the improved benefit from the approval rate, if you take that $5,000,000 out, you'll see the improvement. It's about 200 basis points year over year and that is sustainable. We do believe that the improvements there will endure, but you don't get both the catch up and the improvement every quarter moving forward.

Speaker 6

Got it. Okay, that's helpful. Thanks, Frank, and thanks, Ashley. One clarifying follow-up from the prior question. Bill, did you say that CE Mark is now expected later in the second half, so basically implying that it's a 4th quarter target?

Speaker 6

So just wanted to check on that if I heard that right. And then just wanted to see if you have any updated thoughts or perspective on the regulatory path for Medis, just how you're going to proceed there? Thank you.

Speaker 2

Sure. So I did not say late in the second half for CE Mark. And then Asaf, maybe you want to comment on the next steps for the MADIS submission?

Speaker 3

Yes. Thank you. So we're right now evaluating and finalize the all analysis and preparing for submission. And we are planning to do it in the near future.

Speaker 9

We'll come

Speaker 3

back and let everyone know exactly which department in the FDA, but we are working on it.

Speaker 6

Maybe to follow-up quick, I mean, any is this something we should expect submission before year end? Is this a 25% just dynamic? Just trying to understand, as we kind of pencil things out from a milestone standpoint where Medis is going to land.

Speaker 3

Our goal is to try to finalize this year.

Speaker 9

Okay. Thank you. Thank you.

Operator

Thank you. Our next question comes from Larry Biegelsen of Wells Fargo. Your line is open.

Speaker 10

Good morning. Thanks for taking the question. Just a follow-up on that last response. Asaf, when you say our goal is to finalize this year, I assume just maybe this is just a little bit of a language barrier. But when you say finalize, you're saying we plan to submit the Medis application in 2024 in the U.

Speaker 10

S. And Europe. Is that what you meant by finalize this year?

Speaker 9

Yes, this one. Yes. Okay.

Speaker 10

Okay. And maybe just to follow-up on Medis, what are you guys hearing from clinicians? How do they see tumor treating fields fitting into the treatment paradigm? And I had a follow-up.

Speaker 7

Yes. Larry, this is Frank. Thank you for the question. What I can say is that we unveiled the data from METIS at ASCO in June and we really saw across the board strong interest in understanding the data. I think I'd also just share the anecdote that at ASCO this year, we saw just broader awareness of tumor treating fields across all of the indications where we've released data.

Speaker 7

And I think really seeing that strong interest both from the radiation oncology attendees, but also from the medical oncology attendees, a strong interest really focused on the fact that the delay in time to progression is a clinically meaningful endpoint in terms of helping patients with BRAINMET. So really pleased with what we saw at ASCO this year and we're encouraged to move forward with clinicians to help these patients.

Speaker 10

And the treatment paradigm, what are you hearing?

Speaker 7

Sorry, I'm not sure I fully understand the question, but I think in terms of sort of details on what drugs may be used concurrently or the exact specific patients. That's some of the analysis that's still ongoing from the trial and we'll update you as it becomes available.

Speaker 10

Okay. And then on B36, can you you provided a little bit of an update in the prepared remarks there. How many patients have been enrolled? What are the options for the next steps? And how does that impact how you think about enrollment of LUNAR-two?

Speaker 10

I guess, it's taken a long time to enroll B36. I guess the concern is that it's going to take equally long to enroll LUNAR-two?

Speaker 11

This is Nicholas. Thank you very much for that great question. I think something is very, very important that B36 is not the tool in a lot of different aspects. So what we said is that we are just evaluating appropriate next steps for B36. Now let me remind you what B36 is.

Speaker 11

It's a Phase II study in first line non small cell lung cancer with monotherapy pembro. And just to remind you, monotherapy pembro is 5% of patients in the U. S. And it's a trial just being run-in the U. S.

Speaker 11

And again, it's a Phase II trial. Now Phase II trials have the characteristic to lead us for Phase III trials and inform us how we need to run Phase III trials. Now LUNAR-two is a Phase III pivotal trial that is exploring TTFields, pembro and platinum based chemotherapy, which is one of the main foundation in U. S. Patients at least and about 95%.

Speaker 11

So we are having a very, very, very different situation.

Speaker 10

I got it. Just one maybe if I could sneak in for Ashley with the multi tranche financing, are you now more likely to meet the 2025 convert using cash now? Can you be more specific on the planned usage of the financing beyond the convert? Thank you.

Speaker 8

Yes. We're quite confident that we now have the strength of

Speaker 4

the balance sheet we need

Speaker 8

to pay down that convert. So I don't anticipate

Speaker 4

any challenges there.

Speaker 10

Okay, great. Thanks for taking the questions.

Operator

Thank you. Our next question comes from Jessica Fye of JPMorgan. Your line is open.

Speaker 12

Hey guys, good morning. Thanks for taking my questions.

Speaker 13

You talked about France as a nice growth contributor and broke it out for 2Q. Can you tell us what France sales were in the Q1 and talk about how we should think of its contribution in the back half? And then following up on the earlier comments on U. S. Net price, I think I heard sort of a clean 200 basis point year over year improvement in U.

Speaker 13

S. Net selling price is sustainable. Is that it and will eventually annualize over that and be done or is there more room to run on U. S. Net selling price?

Speaker 13

And if so, how much? Thank you.

Speaker 4

Yes. Jeff, this is Ashley.

Speaker 8

I can jump in there with the specific modeling questions and then let Frank follow-up with any color on France. In the Q1, France was about $10,500,000 and you saw that Q2 2014. It's always a nice milestone when you cross into being a material market. So France will be broken out from here on. And again, congratulations to the entire French team for that.

Speaker 8

It's really an awesome milestone. But so we do continue to see growth there and our growth will moderate as that market matures, but it is approaching a German life size market now and we expect it continue to perform as we move forward. If we move over to the U. S. Net price, I'll challenge that team always to get better.

Speaker 8

And I know I have a team there that's focused and market on doing it. But we are approaching approval on almost all patients in the U. S. Now. So there is not much more room to grow in our commercial payers.

Speaker 8

This is a very sustainable improvement. We think we can hold it. We're always after kind of incremental bits that we can get, but I want to manage expectations that net price in the U. S. Now is a reasonable net price to model moving forward.

Speaker 7

This is Frank. I'll add just a bit of color on the business in France and repeat what we said during the prepared remarks, which is France is really our blueprint for success in launching. We prepared the market with a team of both the business teams, the medical teams. We had clinical trials open in the market in advance of actually getting approval and getting reimbursement. And I think it's we are very pleased with the results and we're quite frankly ahead of schedule of where we expected to be in France in terms of market penetration.

Speaker 7

It's exciting that we're now crossing over a little bit more over 5 quarters, a little bit more than a year into the launch and still seeing the excitement from our clinicians and also from the patients who are now coming a year into the therapy. So it's really our blueprint for success in the future.

Operator

Thank you. Our next question comes from Vijay Kumar of Evercore ISI. Your line is open.

Speaker 9

Hey, guys. Thanks for taking my question. A couple of modeling related questions. France, annualizing north of $50,000,000 is that how do you size the top market opportunity, right? Is this expected to continue?

Speaker 9

It's a strong sequential trends in the next year. And for comparison, like what was France revenue base in fiscal 2020?

Speaker 8

Yes. I mean, I would encourage you to say VJ France is German like in its sizing and we expect those to be our 2 largest European markets. And then as we look ahead, we do expect to be able to begin to bring on in upcoming years additional big five markets, which will add more revenue. So it is German like in its opportunity. And yes, we continue to expect growth out of all of our markets.

Speaker 8

I will say, as it ramps up, it's growing off of a solid base. And of course, we have to keep that in mind, but it is a market we expect to be Germany like inside.

Speaker 9

And sorry, on the revenue base in fiscal 2020 3, which was France in fiscal 2020 3?

Speaker 8

I don't think we broke that out in 2023. I would tell you, yes, I mean, if you look at the other EMEA markets, which we do break out in our Q, Vijay, the vast majority of it is right.

Speaker 9

Understood. And then how does reimbursement work in France? When I look at that net patient revenue in that other EMEA region, like that's tracking about Germany. And when we look at Germany, I think once you had national payments kick in, rates got cut. So is France is there any risk of future updates for reimbursement rates?

Speaker 9

Or is this all said and done?

Speaker 8

Yes. So the short answer is not expected, Vijay. Now the longer answer in there, this is an important distinction is that we have 2 markets where we go at risk of reimbursement on a named patient basis on launch. Those are U. S.

Speaker 8

And Germany, and you hear us in lung, that's where we will launch. And the other markets, it's national reimbursement and we do not launch until we have reimbursement secured. So that is how we handle France. That is how we will handle all other markets outside of the U. S.

Speaker 8

And Germany. So that revenue is stable and durable.

Speaker 9

Understood. That's helpful. Maybe last question on this panova pancreatic cancer. Can you maybe high level compare contrast like you've had several trials, GBM, metastatic brain cancer, NSCLC. When you look at pancreatic cancer, is there anything different about this disease state when you compare versus the others?

Speaker 9

And when you look at the early experience, early data on pancreatic side, how does that compare versus other disease states? Anything that sets apart pancreatic opportunity for you guys?

Speaker 2

Sure. So, Vijay, it's Bill. As we've noted in the past, tumor treating fields provides the best opportunity to extend survival when it's used early in the patient journey. In many cancer types, and this was true in non small cell lung cancer, just because of the way that the field has evolved and we need to start our trials in later lines when the patients are sicker. In the case of PENOVA 3, that trial was designed as a first line trial.

Speaker 2

So number 1, that is positive with respect to tumor treating fuels therapy. Secondly, we know that we are a regional local therapy and that we and we saw this in the Phase 2 PANOVA data that when we can treat the full extent of the disease And that means diagnosing it earlier when it has only spread locally, we have the best outcomes. And again, in this trial, PENOVA-three, this trial was in the about 50% of the patients who receive a pancreatic cancer diagnosis who have locally advanced therapy. So because it's first line and because it's in the locally advanced population, we think the trial is was well designed. And if we had designed it today, we would have designed it with the same design.

Speaker 2

So we're all really looking forward to reporting out the results later this year.

Speaker 9

That's extremely helpful comments, Philip. Maybe one last follow-up on that. When you say given it's a local regional treatment, is that does that mean tumor needs to be in 5th, early stage, stage 1, stage 2 cancer as against stage 3? When you say 50% of patients, so at the time of diagnosis, are 50% of pancreatic cancer cases in the Stage 1, Stage 2?

Speaker 2

Yes. So let me our understanding is that in the U. S, when pancreatic remember, we're not all being scanned for pancreatic cancer every year. And that about 10% of patients are diagnosed usually by accidental findings when they have pancreatic cancer that is operable and they will receive surgery. The remaining 90% are diagnosed past the point when it's operable.

Speaker 2

And of those, some and they're different numbers, but 35%, 40% are again diagnosed when it has expanded locally and the remaining 40%, 45%, it is already systemic and metastatic throughout the body. So PENOVA-three is focused on those patients where the that are not 1, not operable, but 2, the pancreatic cancer has not spread into the bones and the brain and the rest of the body.

Speaker 9

That's helpful. So the enrollment criteria, we're looking at those cases, the 10% accidental diagnosis and the 35%, 40% for local, correct? That's the patient in the room.

Speaker 7

So 35% to 40%.

Speaker 2

So the patients who were not operated on and where the disease is, again, the term of our care is locally advanced.

Speaker 9

Fantastic. Thanks, guys.

Operator

Our next question comes from Emily Bodnar of H. C. Wainwright. Your line is open.

Speaker 12

Hi, good morning. Thanks for taking the questions. Want to follow-up on the KEYNOTE-thirty six study. Is there anything that you've seen in that study so far in the patients you've enrolled that kind of gives you more confidence in LUTUR2? And then just kind of following up on other markets for Optune.

Speaker 12

Are there what kind of other countries are you looking at, which you think could be similar in size to like the France and Germany market so far?

Speaker 11

I'll take the first part of the question. And I think we usually do not comment about findings on running trials. As far as I understood your question, maybe I misunderstood.

Speaker 12

I just wondered if you have seen anything that gives you confidence in LUNAR-two based on the chemotherapy study?

Speaker 11

As I said before, B36 and LUNAR-two are 2 completely different trials and that does not in any way change the confidence I have in LUNI-two.

Speaker 7

Excellent. And with respect to new markets, we have commented before that up next on the horizon, we are working in both Italy and Spain, which are in each country, it's a region by region approach to gaining reimbursement with hospitals and payers. And we're making progress in both markets. And we think of Italy and Spain together as being our next potential France in terms of a market.

Speaker 12

Thank you for taking the questions.

Operator

Thank you. I'm showing no further questions at this time. I'd like to turn it back to Bill Doyle for closing remarks.

Speaker 2

We entered 2024 with 3 key objectives for the year and also to position us for the future. Those were to grow and return to growth in our GBM business, to launch our indications in the U. S. And Germany in non small cell lung cancer and to deliver on the promise of our clinical and product development pipelines. We're very pleased this morning to be able to report progress across all three.

Speaker 2

And we look forward to the balance of the year where we have significant catalysts ahead. So thank you for your continued interest at NovaCare. Thanks for all the NovaCare employees who are listening for your dedication. It's an exciting time and we will be here for Q3. Thank you.

Operator

This concludes today's conference call. Thank you for participating and you may now disconnect.

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Earnings Conference Call
NovoCure Q2 2024
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