Bristol Myers Squibb Q2 2021 Earnings Call Transcript

Quartr
Provided by Quartr
July 28, 2021

Key Takeaways

  • Double-digit growth in Q2 revenue and non-GAAP EPS, reaffirmed full-year 2021 guidance, and emphasized robust cash flow with ongoing share buybacks.
  • Opdivo returned to growth on the back of new launches in gastric, lung, RCC and upper GI cancers, plus encouraging combination data with relatlimab (LAG-3).
  • Breyanzi and Abecma cell therapies saw strong launch momentum, and Breyanzi delivered the first positive Phase III data showing superiority in second-line transplant-eligible large B cell lymphoma.
  • Expanded the immunology portfolio with the ZYPOZIA launch in ulcerative colitis, initiated Phase III syndecimab trials in eosinophilic esophagitis, and plans additional launches in psoriasis, Crohn’s disease and lupus.
  • Advanced the cardiovascular pipeline with positive top-line CB results and confirmed mavacamten for symptomatic obstructive HCM is on track for U.S. launch in early 2022.
AI Generated. May Contain Errors.
Earnings Conference Call
Bristol Myers Squibb Q2 2021
00:00 / 00:00

There are 17 speakers on the call.

Operator

Good day, and welcome to the Bristol Myers Squibb 2021 Second Quarter Results Conference Call. Today's conference is being recorded. And at this time, I'd like to turn the conference over to Mr. Tim Power, Vice President, Investor Relations. Please go ahead, sir.

Speaker 1

Thanks, Catherine, and good morning, everybody. Thanks for joining us this morning for our Q2 2021 earnings call. Joining me this morning with prepared remarks are Giovanni For you, our Board Chair and Chief Executive Officer and David Elkins, our Chief Financial Officer. Also participating in the call today are Chris Berner, our Chief Commercialization Officer I'm Sumit Hirawat, our Chief Medical Officer and Head of Global Drug Development. As you'll be aware, we've posted slides to vms.com that You can use to follow along with for David and Giovanni's remarks.

Speaker 1

But before we get started, I'll read our forward looking statements. During today's call, we'll make statements about company's future plans and prospects that constitute forward looking statements. Actual results may differ materially from those indicated by these forward looking statements as conference call as a result of various important factors, including those discussed in the company's SEC filings. These forward looking statements represent our estimates as of today should not be relied upon as representing estimates as of any future date. We specifically disclaim any obligation to update forward looking statements even if our estimates change.

Speaker 1

We'll also focus our comments on our non GAAP financial measures, which were adjusted to exclude certain specified items. Reconciliations of those non GAAP financial measures to the most comparable GAAP measures conference call are available at bms.com. And with that, I'll hand it over to Giovanni.

Speaker 2

Thank you, Tim, and good morning, everyone. I hope you're all staying safe and healthy. Now turning to Slide 4, let me start by saying I am very proud of our 2nd quarter results and express my gratitude to our teams across the globe for their dedication and steadfast commitment to our patients. Through their work, we are continuing to make great progress to diversify and renew our portfolio and position Bristol Myers Squibb for an even stronger future. During the Q2, we delivered excellent results across the board, including strong sales growth due to solid commercial performance, the positive clinical results in our mid- and late stage pipeline, continued BD execution and strengthened our financial position.

Speaker 2

The strength of our commercial execution this quarter was underscored by the performance of our key medicines, including the return of Opdivo to growth and the uptake of our new launch portfolio. Over the last 18 months, we launched 5 new medicines with significant potential, and we are very encouraged by their performance to date. Clinically, we continue to deliver on the potential of our pipeline with significant The recent additions to our portfolio added diversification to our business and an opportunity to generate sustained growth over time. From a financial perspective, we saw double digit growth for both the top and bottom line, and we are reaffirming our full year revenue and non GAAP EPS guidance. We continue to maintain a strong balance sheet and generate significant cash flow, allowing us to advance our disciplined capital allocation strategy.

Speaker 2

We remain focused on external business development opportunities to further strengthen our pipeline over the long term. This quarter, we executed 2 licensing deals, an anti digit bispecific antibody program with Agenus and Morab this time, 2 zero two, a folate receptor alpha ADC with Eisai, both strategically aligned with Our oncology franchise. Overall, I am extremely pleased with our progress in the quarter. Turning now In oncology, we are strengthening our IO franchise and have returned Opdivo to growth through multiple clinical successes and excellent commercial execution. Earlier this year, we launched Opdivo in 3 additional indications, including first line gastric cancer, We anticipate additional launch opportunities and growth drivers for Opdivo

Speaker 3

this stage, we

Speaker 2

have a combination of our LAG-three inhibitor, relaclimab with Opdivo. At ASCO last month, we announced impressive results for relaclimab, Potentially, the 3rd I O therapy for BMS, building on our leadership in the field and expanding the durability of our franchise. We have a broader development program underway in IO to benefit more patients over time. Moving to hematology. We received approval in the U.

Speaker 2

S. For 2 cell therapies, Brianca and Abekma, and demand for This product has been strong. Physicians recognize the value of these treatments, and there is significant patient need. Building on existing indications for Brienzi, we announced the first ever positive Phase III top line data in second line transplant eligible large B cell lymphoma last month. This is an important result.

Speaker 2

For the first time, we have assumes that our cell therapy treatment is superior to a well established standard of care. The positive results demonstrate that we can benefit patients early in their treatment journey. We look forward to sharing more details on these results later this year. We also have Iberdomide Phase II data in house, which we are very pleased with and look forward to discussing with health authorities. The data are potentially the first step towards the establishment of a new backbone of treatment in multiple myeloma, this Offering a better option to benefit patients.

Speaker 2

We have made tremendous progress expanding our immunology franchise. We expect to launch this potential new medicine in psoriasis in the second half of twenty twenty two. In ulcerative colitis later this year and in Crohn's disease and lupus in 2022 to further expand the potential of this molecule. We initiated our Phase III program for syndacimab in eosinophilic esophagitis. And last month, in the U.

Speaker 2

S, We launched ZYPOZIA in ulcerative colitis. Finally, turning to CB. We are encouraged by the top line results we received this quarter Additionally, we are preparing to launch mavacamten for symptomatic obstructive HCM in the U. S. Early next year.

Speaker 2

We are encouraged by the potential of these assets to strengthen the durability of our CV franchise. In closing, on Slide 6, the start of the year, we remain focused on driving in line product executing on our launches, advancing early, mid- and late stage pipeline opportunities and continuing to take a disciplined approach Our strong clinical performance further derisks our launch portfolio. And as a result, Our confidence in our ability to deliver the $20,000,000,000 to $25,000,000,000 in non risk adjusted revenue in 2029 continues to increase. Our continued strong financial performance and balance sheet enable us to diversify and strengthen our long As our sales force returns to the field and we welcome our remote teams back to the office, I'm excited by the opportunity to reconnect with our colleagues, stakeholders and patients. I believe we have the strongest pipeline and launch portfolio in BMS' time, I'm very excited about our future.

Speaker 2

With that, I'll turn it over to David to walk you through the financials. David?

Speaker 3

Thank you, Giovanni, and thank you all for joining our call today. Let me start with our top line performance on Slide 8. I'm very pleased to discuss our strong double digit growth this quarter, driven by increased demand for our key medicines across the globe. Looking at the first half of the year, which normalizes for most of the COVID related buying patterns we experienced last year, commercial performance was strong, up 9% year over year or 7% excluding currency. This robust performance demonstrates both our strong execution of our commercial teams as well as increased demand for our products.

Speaker 3

I'll now provide additional color on the performance of our key brands and new launches starting with Eliquis on Slide 9. This is another strong quarter for Eliquis with global sales up 29% versus last year. 2nd quarter growth benefited from a favorable year over year comparison as time, the prior year included the unwinding of COVID related buying patterns. When looking at the first half to normalize for this dynamic, Sales remain strong, up 18%. In the U.

Speaker 3

S, we saw strong demand with total prescription growth of 14% versus prior year, this conference call, driven by market share gains, which continue to expect strong new to brand share growth for further translate to overall total prescription growth. As a reminder, when we look toward the 3rd and 4th quarters, we expect similar dynamics from the Medicare coverage gap that's seen in previous years. Internationally, we had very strong demand across all key geographies as we further gained share as the number one and we continue to see additional room to grow. Overall, we remain very pleased with the execution of Eliquis around the world and time, we expect to continue to grow Eliquis share within a growing class. Now turning to Opdivo on Slide 10, let me start by saying we're very pleased to this time, we will deliver return to growth this quarter, up 16% versus last year.

Speaker 3

While COVID recovery dynamics well as approximately $40,000,000 in U. S. Inventory build contributed this quarter's growth, the brand's performance was largely driven by strong demand for both our core and our newly launched indications. In the U. S, sales were up 13% year over year as well as 14% sequentially, Driven by launches in lung, RCC and our upper GI cancers, which are all going well.

Speaker 3

In lung, share is in the low double digits this stage with positive momentum and we are seeing use across all histologies. In RCC, our Opdivo plus cabo launch continues to do well, With Opdivo now the leading PD-one first line renal across both available regimens. In upper GI, we saw a very strong start with Opdivo Plus Chemo in First Line Gastric Cancer with CheckMate 649, which reached 25% to 30% share in just a few months this time, based upon the strength of our data. The adjuvant esophageal launch, while still in early days, is off to a great start. Overall, we see upper GI as an important opportunity for Opdivo based on the breadth of Alford indications and the fact that Opdivo is the only PD therapy approved

Speaker 1

it is for HER2 negative gastric cancer.

Speaker 3

Outside the U. S, we had another strong quarter with sales up 13%, excluding the impact of foreign currency versus last year. Growth was primarily driven by demand of our new launches in lung and renal cancer. Results also benefited from favorable comparison due to COVID related impact last year. All in all, we're very pleased with Opdivo's performance and future growth outlook based upon the positive momentum for our current launches, this stage, our future potential launches, including muscle invasive bladder cancer and first line esophageal as well as potential expansion opportunities from clinical time, we will be conducting a few trials that will read out over time.

Speaker 3

Now turning to Slide 11 regarding our in line multiple myeloma portfolio. Revimed was up globally, primarily driven by demand for triplet based therapies and increasing treatment duration. In the U. S, we are encouraged to see prescriptions nearing pre stations nearing pre COVID levels. Palmos global sales were up 15%, driven by continued strong demand for triplet based therapies and use in earlier lines.

Speaker 3

Now moving to our recent launches on Slide 12, we continue to be very pleased with our new launches. Beginning with Revlisil, which generated $128,000,000 in Q2 and increased 14% sequentially. As the bolus from the MDS launches continue to wind down, is being replaced by underlying demand growth as expected. We continue to expect sustained growth in the second half of the year as we remain focused on treating new patients earlier in their treatment journey and ensuring you'll receive the most appropriate dose for sustained benefit. Moving to CIPOSIA, which generated $28,000,000 in the quarter, The MS launch continues to progress well where ZYPOSIA is the S1P of choice in terms of written prescriptions and where we continue to see high intent to prescribe metrics.

Speaker 3

We have also seen an acceleration in the conversion time from written prescriptions to commercially supplied product. Looking forward, We continue to focus on establishing Zeposia not only as the S1P of choice, but also the oral treatment conference call. Beyond MS, we launched symposia in ulcerative colitis in the U. S. In early June.

Speaker 3

While early in the launch, we are very encouraged time, we are encouraged by physician receptivity to the product so far. Our plan is to focus on stepwise process of building volume by establishing demand for this differentiated oral like, the same time, we are maximizing access at the time. Turning to Onurig, the launch is also going well stage with double digit demand growth over prior quarter. We continue to expand the user base with physicians recognizing Anure it's the first and only FDA approved treatment for AML patients in first remission with a demonstrated OS benefit. 2nd quarter sales were impacted by reduced inventory driven by our transition from bottles to blister cards.

Speaker 3

However, based upon the strength this time, we expect to see sales rebound in the second half of the year. Remember that this is a new treatment segment where it will take time to shape and establish Onyureg as a maintenance Looking at each of these products internationally, we are encouraged to see how these launches are going and we look forward to driving growth to gaining access and reimbursement in additional markets over time. Now I'd like to turn to Slide 13 and discuss cell therapy. Demand for our 2 new differentiated cell therapy products this conference call has been strong. Starting with Breanzi, we are pleased with our launch progress with Q2 sales of $17,000,000 this Our 1st in class BCMA CAR T had sales of $24,000,000 in the quarter, led by very strong demand.

Speaker 3

We were able to leverage the site footprint of Briansy this stage, we are pleased to accelerate site onboarding, an advantage of launching 2 CAR T medicines simultaneously. Based on the significant unmet demand and at the and differentiated profile, we have seen robust demand for this product beyond our current capacity and we are looking hard to increase capacity over time. Looking forward, we continue to see meaningful long term potential with our cell therapy franchise across both BEYONDZI and DEBECMA as evidenced by the recent demand we've seen. Now turning to the next slide, a few points as we think about our launch portfolio overall. First, we are very encouraged with how each of these products are progressing at this point in the launch cycle.

Speaker 3

Together, they have already contributed $225,000,000 this quarter and are approaching $1,000,000,000 run rate. Importantly, we review these products as having significant future potential. This This gives us great confidence in our ability to diversify and renew our portfolio as we look forward. Now let me take time. I'll take you through a few line items on our P and L on Slide 15.

Speaker 3

Since we've already covered Chong's sales for the quarter, I'll focus on a couple of other key line items. First, Gross margin decreased versus prior year, which is primarily due to foreign exchange and product mix. Operating expenses were higher than last year, time, particularly in MS and A due to higher launch and pre launch investments across therapeutic areas as well as foreign exchange, which were partially offset by our realized synergies. Remember

Speaker 4

that at

Speaker 3

the same time period last year, our spend levels were lower than normal due to the initial wave of COVID. Effective tax rate was 16.9%, primarily driven by our earnings mix and overall non GAAP EPS same time, increased significantly year over year, primarily driven by our strong top line performance. Now switching gears to the balance sheet and our capital allocation on Slide 16. Our liquidity position remains strong with over $13,000,000,000 in cash and marketable securities and strong cash flow from operations of $3,100,000,000 in the Our capital allocation priorities remain unchanged. During the quarter, we continued to strengthen the balance sheet while renewing and diversifying our portfolio through business development.

Speaker 3

As Giovanni mentioned, we executed 2 deals during the quarter that both complement and diversify our oncology portfolio with Agenus and Eisai. As it relates to continued debt reduction, our $4,000,000,000 tender offer and additional $1,500,000,000 in maturities in the first half of the year demonstrates our commitment to strong investment grade rating. As it relates to our share repurchases of the planned buyback of $3,000,000,000 to $4,000,000,000 this year, we We have already bought back $3,000,000,000 to date and will remain opportunistic as the year progresses. Now turning to our 2021 guidance on Slide 17. Following this quarter's performance, we are reaffirming our top and bottom line non GAAP guidance for the year, which reflects significant growth over last year.

Speaker 3

From a full year revenue perspective, we continue to expect growth in the high single digits. In terms of same time, we are facing for the remainder of the year due to Eliquis' coverage gap and unwinding of Opdivo inventory that I noted earlier, we expect Q3 global revenues to be similar to Q2. However, we are encouraged by the strength in the business and expect full year sales at the higher end of our guidance. We have updated our gross margin assumption to 80% for the full year, primarily due to product mix and the impact of foreign exchange. Moving to operating expenses, we are maintaining our full year guidance on MS and A of low single digit increase and on R and D of mid single digit increase.

Speaker 3

In terms of phasing for OpEx, we expect it to increase quarter over quarter at a similar pace to the first half of the year. Based on that and the strength of the business, conference call, we are reaffirming non GAAP diluted EPS of $7.35 $7.55 for 2021. This quarter, we remain pleased not just with our performance, but also with the considerable progress we've made in executing our launches and advancing our pipeline. I'll now turn the call back over to Tim and Giovanni for Q and A.

Speaker 1

Thanks, David. Catherine, can we go to our first question, please?

Operator

Thank you. We'll take the first question from Chris Scott at JPMorgan. Please go ahead.

Speaker 5

Great. Thanks so much for the questions. I guess the first one for me was on Opdivo and maybe just a 2 parter here. First of all, good to see that return to growth. But what are you Seeing for Opdivo in terms of the COVID impact, I know you've talked in the past about some lingering kind of headwinds, but I was wondering if the latest as we move through June, July, is that business still depressed Are we starting to see a more normalized environment?

Speaker 5

And then the second one on Opdivo was just a little bit more color on the rollout in gastric in In terms of where we stand today in terms of penetration rates. Then my final question was just on the competitive environment for mavacamten in light of this The recent competitor data, I just want to see kind of more broadly speaking, has there been any change in view or confidence in that asset at all? Thanks so much.

Speaker 2

Thank you, Chris. Let me ask Chris Werner to answer your question about Opdivo, and then Samit will make some comments

Speaker 6

on the time of Mel Campton. Sure. Thanks for the question, Chris. So let me start with the COVID impact. We have seen a recovery in the IO market really coming out of Q1 and into Q2.

Speaker 6

And I would say that is recovery on multiple parameters. First, we've seen new patient claims. While they still lag pre COVID levels, they've certainly improved quarter over quarter. IO demand continues to recover versus the pre COVID levels and in fact grew about 5% quarter over quarter. And importantly, we've seen an increase in in person engagement.

Speaker 6

Oncology still lacks other therapeutic areas, but increasingly our field teams are able to engage live with our customers. And that's going to be really important given the competitive nature of a number of these markets this slide, first line lung cancer. So I would say in general, COVID continues to be dynamic really across markets. And certainly, that's true In oncology, but I would say there's been a general improvement as we exited Q1 and into Q2. As for how things are going in gastric cancer, I would say The gastric launch continues to go really very well.

Speaker 6

As you know, we have multiple indications now in gastric cancer. And I would say that in general, the first line metastatic launch is going quite well. Our share is roughly 35%. That's being led really by the gastric segment that we see really good utilization of Opdivo plus chemo in both GEJ and EAC as well. We're seeing use across all CPS levels.

Speaker 6

As you would expect, the majority is in the greater than 10%, but we are seeing strong uptake and less than 10% as well. And I would say execution has been very good. And in fact, we have the number one share of voice and we continue to build new trials, which is important at this stage in the launch. So Overall, we're very happy with the performance in gastric.

Speaker 4

And Chris, I'll just thank you, Fusen. Chris, I'll just take on the mavacamten question that you asked. And I guess The question is emerging from the Redwood data that were recently shared through a press release. And while it's truly an apples to oranges this comparison, if we were to indulge in that, I would say that we don't see a differentiation as might have been perceived. And the reason for If you look at it from an efficacy perspective, the measures were at a different time point, 1st of all, 10 weeks versus a 30 week trial for EXPLORER.

Speaker 4

Secondly, the differences or the primary endpoints that were measured were at rest and with Valsalva maneuver in the Redwood trial versus doing this time, so if you were to compare those apples to apples, there is no differentiation that we see. From a safety perspective as well, when we talk about decreasing the Ejection fraction. If you start with a higher ejection fraction, of course, you will not see as big of a decrease below 50%, Which was the case in the Redwood trial, we had patients enrolled in our EXPLORER study with a lower rejection fraction of 55% or lower. And therefore, when we compare apples to apples again, in fact, if anything, we could turn out to be better. At the end of it all, I would say we need to wait to see the data in the Phase III trials for the competitor molecule.

Speaker 4

We already have our Phase 3 data. We've already submitted and look forward to bringing it to patients with the PDUFA date in January.

Speaker 1

Thanks so much. Can we go to our next question, please?

Operator

Thank you. We'll now take the next question start of Geoff Meacham of Bank of America. Please go ahead.

Speaker 7

Hey, guys. Thanks for the question. Congrats on the quarter. Just had a few. On the cell therapy launches, you guys had a good quarter out of the gate.

Speaker 7

So I wanted to ask you what the drivers the next few quarters are. Is it Signing out more accounts, is it establishing better reimbursement? And maybe just help us with kind of if you had any manufacturing this Bottlenecks, I know you guys have talked about that previously. And then on dukravasitinib, maybe just help us with kind of how you're thinking about What success looks like in ulcerative colitis? And also, any additional thoughts that you've had?

Speaker 7

I know there's been a lot of

Speaker 2

Thank you, Jeff. So let's start with Celterabee. Let me just say first, really exciting. And the launch is off to a great start. It really demonstrates that our decision to invest in this technology And the differentiated nature of our 2 products is paying off.

Speaker 2

There is a lot of excitement. Let me ask Krish to give you more details and then Samit will give you his perspective on ducromasatinib. Correct?

Speaker 6

Yes. So I would just reiterate what Giovanni just said. The commercial and medical launches for both products continues to be very strong. We've seen good execution Across the teams, importantly, for both Abecna and Brianca, the profiles for these products are resonating well with customer in the case of Abekna as a 1st in class BCMA targeted cell therapy and for Briansy as a best in class. One of the things we've seen Crossbow products that there is significant unmet need.

Speaker 6

That's particularly true in the case of Abekma just given the fact that there are no other this opportunities in many cases for these patients. And as a result, we've seen very strong demand for both products. What I would say is for Briandzi, the focus continues to be on ensuring the sites know how to manage these patients well, continuing to sell the best in best profile that we have with Briandzi, and we're increasingly seeing interest in patients being referred to clinical trial sites, so we're managing that well For Beccma, I would say the focus there continues to be engaging with customers around manufacturing capacity. As As we had said previously, this is a space where because of the significant unmet need and because we are the 1st PCMA targeted cell therapy in the space, The demand for this product has outstripped our current capacity to manufacture. What I would say is the sole focus that we have there is on steadily increasing manufacturing capacity.

Speaker 6

We have a very strong team that's in place focused on this. We're engaging obviously Internally and externally with third parties, including regulators to increase the number of slots that we have available for patients and that's going to be the main focus on that product For the coming months.

Speaker 4

Thanks. And maybe I can take on the DUKORAVA question in terms of ulcerative colitis for DUKORAVA. As you know, With a TYK2 inhibitor, we know the downstream effect is an inhibition of IL-twelve and IL-twenty three pathway. These mechanisms are already proven to be effective in ulcerative colitis. So we are truly looking forward to seeing the data at the end of the year from our Phase 2 study, Where we will get to see the induction data comparing DUKAVA versus placebo.

Speaker 4

So we know what success would look like because There is proven mechanisms out there. We know what the efficacy that we would be looking for in a Phase 2 study to initiate our Phase 3 program. And the good news is we also have the Crohn's disease study ongoing, which we'll read out in next year. So a broad program that we will be able to take forward To really get the Phase 3 data to impact the second half of the decade following the ZYPOZIA launch right now in that disease.

Speaker 1

Thanks, Alex. Catherine, can we go to the next question, please?

Operator

Thank you. We'll now take the next question from Terence Flynn at Goldman Please go ahead.

Speaker 8

Hi, great. Thanks for taking the questions. Congrats on the progress of the new products. Maybe 2 for me. Just From your manufacturing facility that you have right now.

Speaker 8

And then remind us of timing to bring on additional capacity as again, I think you guys are building out some further capacity there. So And then a question for Sumit on the Factor XIa program. I know we talked about this Last month, you have the data in house, but any more perspective on how to think about starting up a trial in the AFib setting? Or is that really contingent same time, I'm seeing data from the 2nd Phase 2 trial. Thank you.

Speaker 9

Thanks, Terence. Chris, do you want

Speaker 2

to start on Abekma? Sure. So as

Speaker 6

I said in the previous question, our focus continues to be to increase the available capacity that we have for this product. As I think we've discussed previously, We had increased the number of thoughts that were available for patients to August, and so we were able to increase To meet the demand in August, at the same time, we continue to see a shortage of vector that is something that's been affecting multiple Cell therapy products and so we're keeping an eye on that. And what I would say, Terrence, is that the situation on vector supply continues this point, we'll ramp significantly. I would say that rather than put out a date that would likely shift, I'll just say that commercial demand and then obviously we have a longer term focus on ensuring more stable long term supply for vector that would be available to support both of these products, but That's where the situation sets for Avecma.

Speaker 4

And Terence, for millexion or the same time, what I would say is that what we've seen thus far from the total knee replacement study, we are very pleased with that. The trial showed exactly what we anticipated it to show. And we do believe, along with our collaborator, Janssen, that we do need the second trial data As collectively the two trials will form the basis for the clinical development plan, remember in the first study, in the TKR study, we only have about 2 weeks the start of dosing with a single agent Factor XI inhibitor. Whereas in the second trial, in the secondary stroke prevention, We have the background therapy of doublet antiplatelet therapy as well with up to 3 months of dosing. And so that longevity will be important to understand the overall safety profile and that will obviously then be able to go into Phase 3 program, not only just AF, but we are thinking of other indications as well.

Speaker 1

Thank you so much. Catherine, we can go to the next question, please.

Operator

Thank you. We'll now take the next question of Andrew Baum at Citi. Please go ahead.

Speaker 9

Thank you. A couple of questions. First, we don't hear so much about your earlier generation of

Speaker 10

There's been a number of

Speaker 9

papers out on the importance of Treg depletion and ADCC this part of the CTLA-four mechanism, and I know you have your A2 plus related molecule in a fairly large trial. Could you update us on when we might expect to see some results and just your general level of enthusiasm on that approach for a validated target? And then second, In light of the ADA Helm approval and particularly the biomarker, how is

Speaker 2

this thinking influencing you over your

Speaker 9

time, we're going to be discussing the effects of neurodegenerative disease. Obviously, you've been invested historically in that space. This is a catalyst for

Speaker 2

Bristol to re enter that segment. Thanks, Andrew. Let me make just a couple of very high level comments and then Samit will take both of your questions. So first of all, with respect to IO, I think we're really time, I'm excited about the opportunity to launch our 3rd IO agent potentially soon, which is relacolamab in metastatic melanoma. And that really shows how we are progressing and extending, in fact, the strength of our IO franchise.

Speaker 2

With respect to the CNS, again, Samit will address your question in more detail. From my perspective, what I'd like to This is a research area that we committed to, in fact, as part of the Celgene research strategy a few years ago. We are really excited to have a number of early programs that are continuing to advance. It's primarily driven by a really interesting set

Speaker 4

As you know, we have 3 molecules in development in the backup CTLA-four Probody, non faecosveta and faecosveta molecules. The trials are ongoing, as you said, very well, and we are actually looking forward to see the data towards the end of the year as well as in early part of next year. That will certainly pave the way for new trials looking at combinations with our pipeline with Opdivo as well as Other molecules that you just heard from Giovanni, we have rilaplimab and then new additions to our pipeline with TIGIT as well as with The ADC that we recently acquired, those clinical development plans are being formulated and appropriate indications are yet to be chosen based on the activity that we will see from these trials. To your second question on the recent approval on Alzheimer's disease and then how to see that data and what We do believe, as Giovanni said, that our focus on neurology and neurodegenerative disease Has continued to be there and we'll continue actually to increase from there onwards. The way we look at that data is now that the threshold has been set From a regulatory perspective, it was hard to gauge before what endpoints to really shoot for and what was the threshold.

Speaker 4

Now that we know what the threshold is, It is now probably going to be better or easier to develop studies because there is a regulatory path forward. As you recall, we recently had announced our collaboration with Prothena and looking forward to make our way into the clinical studies with that tau inhibitor with a differentiated mechanism that we'll be able to take forward. More to follow

Speaker 3

in the

Speaker 1

future. Thanks, Catherine, can we go to the next question please?

Operator

Thank you. We'll now take the next question from Seamus Fernandez of Guggenheim. Please go ahead.

Speaker 10

Great. Thanks for the question. So first on the Beqma, just wanted to get a better sense of Where capacity could potentially go to and if there's any visibility on the vector dynamics And perhaps when that might release, is that entirely reflective of Is that more reflective of the situation in terms of vector manufacturing and capabilities at Blue Bird? Or is it a global market dynamic associated with the sort of use of nucleic acid this Targeted therapies. Just wanted to get a sense of what the impacts are there.

Speaker 10

And then what would the hopes for expansion of the capacity capabilities be in 2022 relative to 2021, do you have any sense this time of timing improvement for the vectors as it relates to Avecma. Second question, Just wanted to

Speaker 6

get a little bit of

Speaker 10

a better sense of the ongoing strategy, The number of targets that you guys are pursuing, specifically in multiple myeloma, you have a huge number of programs I'm going there. Just wanted to have you guys talk a little bit about prioritization in that regard and where you see this time, the most opportunity for new products in that space, whether it be the cell mods or bispecific, The T cell engager, just wondering where we're going to see some acceleration in those programs there. Thanks so much.

Speaker 2

Thanks, Seamus. So on Abekka, let me just say to your question, the supply chain of Globally, the supply chain for Vector is very dynamic. We don't look at this as a specific issue, but rather A really complex issue across the industry. I'll ask Chris to whether there's anything he wants to add. And then we'll talk with Samit about our strategy Multiple myeloma, as I mentioned, excited to have the eberdomide Phase II data in house, which is a really important A step forward for us.

Speaker 2

Chris, anything to add on Avecma?

Speaker 6

Yes. The only thing I would add is, Seamus, just there are sort of 2 dynamics at play with Avecma. One is significant demand that we're seeing in the marketplace, which is, I would say, a function of the fact that there's significant unmet need, the profile of Opecma is very strong And the fact that you've seen a bolus of patients who have been really reserved for these therapies, and this therapy in particular when it launched. So there's very strong demand. And so obviously, there's an internal focus on increasing our ability to supply that demand, which has exceeded the this supply that we anticipated having to deliver into the marketplace.

Speaker 6

The second thing I would say is this broader global issue As we think about our strategy, not only for the end of this year, but really as we get into next year, our focus is going to be ensuring a more stable long term supply of vector. And that's something we'll be happy to update on as we have more details to provide. Amit?

Speaker 4

At Seamus, from a multiple myeloma perspective, we We remain the leaders in multiple myeloma and want to continue to progress on that path. And we have a very strong pipeline, as you very well mentioned. There are 3 pillars to the multiple myeloma strategy. Number 1, the cell mods, and we intend to use these cell mods as the future backbones replacing the image stage that are currently out there. In that regard, the strategy is 2 pronged.

Speaker 4

1 is a single agent entering in the late line of therapy. The first data we've seen with iberdomide already. And then next year, we'll see the data for CC480, the second cell mod, which is more potent. And then progressing them further up the line In terms of combinations, you might see on coontrials.gov, we've already announced and are initiating a trial In patients who have received 2 to 3 prior lines of therapy as a combination of iberdomide with daratumumab and dexamethasone compared to Velcade, daratumumab, dexamethasone. And that strategy will continue as we go further up the line with the CellMiles.

Speaker 4

The second pillar is the BCMA targeted therapies, first of which is already approved, that is Abekma. And the idea for Abekma can get cell therapy because of comorbidities or other reasons. And therefore, other BCMA directed therapies are going to be important, and that's where the T cell engagers and the ADC coming to play, but they are very early in development right now in Phase 1 studies. And so more to follow on that. Our prioritization, our belief remains is very strong that patients with multiple myeloma still are not cured and we will require combination therapies in the future with multiple targets and multiple modalities and will progress accordingly.

Speaker 1

Thanks so much. Catherine Kugel for next question please.

Operator

Thank you. We'll now take the next question from Tim Anderson at Wolfe Research. Please go ahead.

Speaker 11

Thank you. Eliquis continues to do well. Of course, one thing that could derail would be an appeals court ruling overturning the lower court. Can you just give us Your expectation for a time line on an appeals court ruling. And then second question, just navacamten, it It feels like there's a kind of a back story on the regulatory front, why you guys got the standard review because at the time of that deal you did expect and you had it in So a fair amount of time has elapsed Since you got standard review, and I'm wondering if you can share what concerns the agency may have.

Speaker 11

It seems like there may be some concerns about not having long

Speaker 2

Yes. Thanks, Tim. Sami, do you want to start with the second question?

Speaker 4

Sure, absolutely. For mavacamten, Tim, We've already filed for mavacamten. The FDA has already accepted the file. We have a PDUFA date. So those concerns, I think, are relieved and are we are really looking forward to bringing these exciting data as well as the medicine to patients conference call.

Speaker 4

As you know, with mavacamten, we have other plans that are already ongoing and in execution in other disease types as well. So We don't see it as a showstopper in any which way and looking forward to really the readout on

Speaker 2

Thank you, Samit. And with respect to your first question, Tim, on The IP litigation for Eliquis. First of all, as you know, we're very pleased with the decision that was Made by the court in the past summer, which really confirms the strength of not only the composition of matter patent, but also our formulation patent. And as you mentioned, there is an appeal that has been filed and the hearing is scheduled in September. So we look forward to hearing the result of that process.

Speaker 1

Thanks, Giovanni. Catherine, could we go to the next question, please?

Operator

Thank you. We'll now take the next question from Carter Gould at Barclays. Please go ahead.

Speaker 12

Good morning. Thanks, Sung Ji, and congrats on the results so far. Maybe just first on REBLESYL. Can you talk about sort of the headwinds you're still seeing from COVID? And also as you think about Ex U.

Speaker 12

S. Kind of ramping over the second half of the year, any color on expectations or additional countries you expect to launch in? And then maybe coming back to Vertamide, Samad, you talked about the combination study that got posted on clinicaltrials.gov. Can you Just talk a little bit more around just sort of demonstrating clinical meaningfulness in the setting where obviously you're going to have Generic IMBIT in the not too distant future and you're still in the study you're comparing against There's no EBIT in the comparison. So just really kind of driving home that the importance of CellMuds in this setting would be helpful.

Speaker 12

Thank you.

Speaker 2

Thanks for the questions. There's really good dynamics on Replicil. Let me ask Chris to give you a better perspective before we color Yes. Thanks for the question, Carter. So with respect to COVID, I

Speaker 6

would say it's very similar to the answer I gave previously on COVID. I think the dynamics in that market are this stage, we've not yet seen a full return to normal. But what I would say is in the quarter, we also there saw an improvement both with respect to new patients entering the clinic and being given access to therapy as well as importantly, again, our field team's ability to interact been treated for a considerable time on ESAs. So those dynamics we think are very favorable and bode well for continued this Growth opportunities for us as we go into the second half of the year. And with respect to the ex U.

Speaker 6

S. Launches, say it's still very early days, but what we've seen is very good customer reception in early launch markets like Germany. The execution in those markets have been good as COVID continues to improve there and we're able to engage with customers more. We see those dynamics continuing to improve over the course of the year. And then we have, of course, additional launches as access is secured, Most notably with Belgium, the Netherlands, France and Italy in the coming months.

Speaker 4

Thanks, Chris. And for iberdomide, the way I look at it is There is a progression of how we move forward and how we move up the line. If you recall, over the last couple of meetings at ASCO as well this stage, we've been able to show the overall profile for iberdomide because of its tolerability, the combinability is good. So we've been able to combine with Dara. We've been able to combine with Kyprolis as well as with Valkade.

Speaker 4

So this is just one of the first studies that we have launched in the Phase 3 setting in the randomized trials. As you know, there's a Phase 2 study that is also ongoing doing a head to head comparison of Revlimid versus iberdomide in Europe Through ENM, and we will get to see the data that will form the basis of the future Phase III trial there. And there will be other studies that will be coming through where you start to see the comparisons versus the image as well.

Speaker 1

Thanks, Salve. Catharine, can we go to the next question, please?

Operator

Thank you. We'll now take the next question from Luisa Hector at Berenberg. Please go ahead.

Speaker 13

Thank you for taking my question. I wanted to come back to ducravitinib. You talked about a potential launch in the second half end of next year, is that a delay? And I know previously you've commented on your plans to build out your dermatology sales force towards the end of this year. Is that still the plan?

Speaker 13

Or does that shift slightly into next

Speaker 2

Thanks, Luisa. Let me say we're really excited getting ready for DUKRAVA. There is no delay, but I'll ask Sami to give you more perspective and then Chris will talk about commercial preparation.

Speaker 4

Sure. Thank you, Ronny. And Luisa, thanks for your question as well. There is one thing that we need to remember that this is an NDA, not an sNDA and certainly 2 very large studies. This is a priority for the company.

Speaker 4

We are certainly looking forward to launching in the second half of next year. And certainly, we will share The acceptance of the file as the file is validated by the regulatory agencies. There is no other way to say it that we are excited about the data with the efficacy and the

Speaker 2

safety that Yes. And what

Speaker 6

I would say in terms of the commercial and medical build out is that's well underway. We feel very good about where we are and the quality of the teams that we've been able to put in place. Medical has been in place for a number of months, and I would say those teams have very deep dermatology experience. We obviously have this time, our key internal roles that have been filled in our in the process of building out launch planning. Our plan is and has been stage, we feel very good about where we are in that timing.

Speaker 6

And our anticipation is that we're going to be ready for launch whenever the approval And so really no change in how we're thinking about building out the commercial teams.

Speaker 1

Great. Thanks. Catherine, could we go to the next question, please?

Operator

Thank you. We'll now take the next question from Steve Scala at Cowen. Please go ahead.

Speaker 14

Thank you. I have a few questions. Regarding the Factor 11a A BTE total knee replacement Phase 2 data. Sumit, you said that the trial showed exactly what was expected. Can you remind us Of what you expected?

Speaker 14

For instance, did you expect 0 bleeds? 2nd, has the FDA asked any questions on duplicitinib CV risk and if so, what was the nature of those questions? And then lastly, do you expect an FDA panel for mavacamten? Thank you.

Speaker 2

Thank you, Steve. Let me ask Samit to address all three of your questions. So for Factor XIa, Steve, what when I say

Speaker 4

we got what we wanted is it was a multi arm study where we looked at the single daily dose as well as BID and it was a dose range. What we wanted from the study to give us an incline on number 1, the safety profile that we were this time, as well as to see what is the dose that we should take to Phase 3. And that's what we intended from the study and that's what we got. And plus, we wanted to see the therapeutic index overall, what dose range one can use in the future programs and that's what we got. Now of course, you'll hear more as the data are presented later this year, but this is where we started off in the PKR study and that's what we got.

Speaker 4

On the DUCRAVA study that you asked about what the cardiovascular risk questions, etcetera, from the regulatory agencies, of course, we will not comment on our this time, we have a very strong conversation with the regulatory agencies. Having said that, you've seen the data, you've shown what The non existence of the cardiovascular risk in the follow-up that we have for bupravacitinib and we are very pleased with the profile that we currently this time, which is very differentiated. On the mavacamten side, once again, not commenting on the regulatory strategies and regulatory conversations, We continue to look forward to the PDUFA date in January, and we are certainly very excited with the data on that side as well.

Speaker 1

Thanks, Simon. Catherine, can we go to the next question, please?

Operator

Thank you. We'll now take the next question from Matthew Harrison at Morgan Stanley. Please go ahead.

Speaker 6

Great. Good morning. Thanks for taking the question. I guess 2 for me, following up on a couple of questions from before on. On Factor XI, can you just maybe put the secondary stroke trial into context?

Speaker 6

What is a good outcome From that study when we see the results later this year. And then second, On the CelMods, especially now that you have some data in house, what do you see as the quickest sort of regulatory plan to get that to market? Thanks.

Speaker 2

Thanks, Matthew. Let me ask Samit to address both of your questions.

Speaker 4

Thank you, Matt. For Factor XIa from the secondary The aim of the trial is to be able to see if Factor XIa can be combined with the background therapy of antiplatelet agents. And that's what we are looking forward to because as you recall, Factor Xa inhibitors that are out there have a higher risk of bleeding when they are combined with antiplatelet therapies.

Speaker 3

So that's

Speaker 4

what the good outcome would look like if we can actually manage that risk profile that is there and that will then pave the way for taking it forward into indications that are to be discussed with our partners and of course with the agencies in the future. For CellMOD, as Giovanni already shared with in his prepared remarks, You've seen the data from the Phase 2 trial of Iberdomide. We are looking forward to having those conversations with the health agencies this based on the overall response rate data and the overall profile that we have for eberdomide. And then that will pave the way for seeing if we can bring the drug to market with

Speaker 2

Let me just say that with CellModes, We have been discussing the progress with this platform for some time. And I think it's really good to be seeing now that we have this time, we have 4, 5 of those agents in the clinic. And the Iberdomyde data is really the beginning of looking at this really important proof of concept data on a number of assets, and I'm really pleased that this platform is progressing so well. I think it's will be really important for us going forward.

Speaker 1

Thanks, Giovanni. Catherine, can we go to our next question, please?

Operator

Thank you. We'll take the next question from time of William Blair. Please go ahead.

Speaker 15

Good morning. Thanks for taking my question. Another Factor time, our 11a question, do you have any thoughts on the recent antibody results in total knee of the vaccine that was published in the Journal of Medicine last week? Obviously, some nice BT prevention, but no real difference in bleeding rates, which might be expected given that was a smaller size study. And then I guess just any general thoughts on antibody versus small molecule approach?

Speaker 15

And then lastly, can you just confirm if Any additional clinical studies for DUCRA, whether it be longer follow-up or any healthy participant data with

Speaker 4

Thank you, Samit. Let me start on the Factor XIa. I will I'll hold myself from commenting on anybody else's studies, but certainly there is the specificity of the antibodies that we have to keep in mind. On the other hand, then you have to keep in mind the oral versus IV aspect of things and oral versus subcutaneous, which will be very important in the future development and the patient this time, we'll need to continue to monitor that and then we'll compare the results when full results are available for our program and other programs as well as we take into account Phase 3 development. For ducarvacitinib, as we have previously talked about, We are looking forward to the approval in the second half of next year.

Speaker 4

So we are not waiting for additional studies from that perspective unless, of course, They've become a part of the conversations with the health agencies.

Speaker 1

And I think we've maybe got time for one last question.

Operator

We'll now take the next question from Dane Leone at Raymond James.

Speaker 16

Hi. Thank you very much for taking the questions and getting one last in here from me. And appreciate The updates across the portfolio. Just one quick one to wrap things up on Factor XIa. How do you see the program evolving?

Speaker 16

Obviously, you seem sound encouraged

Speaker 1

by the results you have in house that will be presented

Speaker 16

later on TKI. Time, I'm encouraged by the results you have in house that will be presented later on TKI. But are you going to take You recently published a paper on 724-296 that looked promising. Just thinking about your competitors and the multi pronged approach they're taking versus how you see the program expanding over time. Thank you.

Speaker 4

Thank you for the question. For Factor XIa, we are pleased with the profile that we have that's far for Factor XIa that is in the clinic already, the milvixin We do have a backup, but that is progressing as one would always have a backup plan at its own pace. We are not accelerating that. We are looking forward to seeing the data for the secondary stroke prevention study early next year and that would then pave the way for Phase 3 program. Nothing more to add

Speaker 2

Thank you, Samit, and thank you all for joining us today. As we've discussed throughout the call, we had a very successful quarter, we delivered strong results consistent with our strategy by continuing to grow revenue, I'm proud of what our team has accomplished so far this year, Including the attainment of several important milestones, and I'm really encouraged by what we are doing for patients. I believe we're very well positioned for the future. I'd like to thank everybody for participating in the call. And of course, our team is available to answer any additional questions you may have.

Speaker 2

Thank you, and have a good day.

Operator

That concludes today's call. Thank you for your participation. You may now disconnect.

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