TG THERAPEUTICS, INC. Q3 FY2024 earnings call

Key Points from Management

• Mike Weiss discussed BRIUMVI's launch progress, including positive feedback and uptake. Data from ECTRIMS showed long-term follow-up of ULTIMATE I & II trials with 92% of patients free from disability progression over 5 years, and ENHANCE study data on faster infusions and switching. Mentioned development of subcu BRIUMVI and azer-cel allogeneic CAR T-cell therapy. Secured FUJIFILM Diosynth as secondary US manufacturer for BRIUMVI.
• Adam Waldman shared commercial updates: BRIUMVI Q3 net sales $83.3 million, 15% q-o-q growth, over 230% y-o-y growth. Steady growth in new prescribers and treatment centers, with 95% of top 100 MS centers using BRIUMVI. Raised full-year guidance for BRIUMVI net US sales to $300-$305 million. Expanded commercial infrastructure and increased patient awareness efforts.
• Sean Power highlighted financial results: GAAP net income $3.9 million for Q3 2024, OpEx below guidance, cash position at $341 million, and commenced share repurchase program.

BRIUMVI third quarter US net sales were $83.3 million. Year-to-date nine month BRIUMVI net product revenue was $206.4 million. BRIUMVI is the key product segment, contributing significantly to the company's revenue in the quarter.

Guidance

• Adam Waldman raised the full-year guidance for BRIUMVI net US sales to $300 million to $305 million, up from the original guidance of $220 million to $260 million provided earlier in 2024.

Risks

• Factors affecting operations include various risk factors as per SEC filings, such as potential differences between forward-looking statements and actual results, clinical trial outcomes, manufacturing challenges, and market competition risks.

Question and Answer

Q: Good morning. Thanks for taking my questions. First, I wanted to ask a big picture question. You mentioned in the press release that you expect to see continued growth in 2025. I just want to get your thoughts on the size of the anti-CD20 market in MS in 2025 and your thoughts on market share, not only for BRIUMVI, but also IV versus subcu?

A: Thanks, Ed, for the question. Adam Waldman responded that CD20 continues to grow, in the low 50% of dynamic share today, expecting it to grow to mid-50s to 60%. BRIUMVI is about 15% of the CD20 market today and has room to grow. On IV vs subcu, Adam mentioned it's around 70% IV to subcu and patient preference is for IV currently.

Q: And just a question on the announced FUJIFILM secondary US-based manufacturing. Your gross margins have been pretty consistent this year quarter-over-quarter. Will this agreement have any impact on gross margin going forward?

A: Sean Power responded that in the near term, no impact. There will be upfront expenditures associated with it, but it will run through R&D. In the long-term, gross margins would remain consistent.

Q: Hey, guys. Thanks so much for taking my question and congrats on the quarter. Two for me. Were there any inventory channel dynamics during 3Q? And separately, what was the TRx script count in 3Q? And how many new patient scripts have been received in the hub? I noticed that wasn't included in your print this morning. Thank you.

A: Adam Waldman stated there are no changes in inventory in the quarter, all distributors are at normal inventory levels. Regarding new patient scripts and hub enrollments, Adam mentioned they are moving away from providing that number as hospital business affects the capture rate and it's not an accurate measure going forward.

Q: Hi, good morning. Just picking up on the plan to adapt for a faster infusion time just coming out of the ENHANCE update at ECTRIMS. Can I get you to elaborate a little bit more on sort of what you -- what might be needed to support a label indication for either a shorter infusion or skipping the loading dose or switch patients? You mentioned possibly needing randomized data. Would the focus there be exclusively on safety? And would you need to assess more than one infusion per patient as part of that -- as part of a trial like that?

A: Michael Weiss responded that for faster infusions, historically, randomized trials are needed, primarily focusing on safety and tolerability. It's unclear if more than one infusion per patient would be needed, but primarily a safety study.

Q: Okay, great. And maybe a follow-up if I could, with respect to the subcu initiative. Can you talk a little bit about sort of what you are tracking in addition to safety to kind of verify or sort of assess how long of a dosing interval you could ultimately move forward within a pivotal study?

A: Michael Weiss said they are looking at bioequivalence primarily, which will determine the tolerability of the material. B-cell decline is not an issue at real dose levels. They hope to share bioequivalent data early next year.

Q: Hi, good morning. Thanks for taking the questions. So thinking about your guidance, it assumes just over -- or I guess, just under 20% sequential growth. And that's incrementally higher than the 15% from Q3. But I was wondering, looking ahead now, should we assume steady growth like this from here on out or a similar cadence of growth like in 2025 like you saw this year and last year with a heavy Q2 and seasonal impacts, just a bit on how you would vision near term dynamics here would be really helpful? Thanks.

A: Adam Waldman said they try to provide the best information they have. The guidance shows sequential revenue growth, they are making investments in patient awareness and other areas to fuel growth. There are seasonal dynamics in the MS market, but they are poised for more growth with traction in the market.

Q: Hi, good morning, guys, and congrats on the quarterly results. I guess for Adam, can you expand on the rates of persistence you're seeing and how it compares to other therapies in the space?

A: Adam Waldman said the compliance numbers compared to other IV CD20 competitors show they are doing at least as good if not better on week 24 compliance.

Q: Good morning, team. Congrats on a strong quarter. And thanks for taking the question. So on the revenue split, if you are able to share between maintenance and maybe new to BRIUMVI patients, if you are able to confirm at what juncture the maintenance patients overwhelmingly take share with the new to BRIUMVI patients. And did you comment by any chance on the share for new to CD20 versus newly diagnosed IMS patients? And would love to hear any color you are seeing in the marketplace within the intra CD20 class switch, what percent patients are up for grabs. We'd love to hear any perspective on that.

A: Adam Waldman said currently revenue split is mostly new versus repeat, but expects repeat prescriptions to become the lion's share in the next several quarters. They haven't provided shares in newly diagnosed or new to CD20. They see a sizable portion of BRIUMVI business coming from switches from Ocrevus and Kesimpta, which has remained steady since launch.

Q: Good morning, guys. Maybe a couple from us. You talked about the bulk of growth in your patient coming from the hospital setting. I guess, remind us what portion of MS patients are taking care of there and why do you think that's been such a good source of new patient growth for you? And then my second question is, as you think about 2025, could we see steady or even maybe accelerating new patient growth on an absolute basis into year three as you get kind of like well into the launch here?

A: Michael Weiss said they believe they can have accelerating new patient starts in 2025 as they get into the launch. Adam Waldman mentioned about 60%-65% of MS patients are seen in the hospital setting, which is why expansion into that segment is encouraging as it's the fastest-growing segment.

Q: Hi, good morning and thank you for taking my questions and congrats on the quarter. Maybe firstly, now that subcu Ocrevus has launched, what are you seeing on the ground in terms of where it's gaining more share from even qualitatively? And second question, you'll start generating obviously a lot of cash over the next few years. Maybe on the broader capital allocation priorities, is there any plans to expand the share buyback program or any other mechanisms you can explore on the capital allocation front?

A: Adam Waldman said they've seen no impact from Ocrevus novo to date. Michael Weiss mentioned they are committed to continuing the share buyback program and will allocate cash to building out the commercial footprint, marketing efforts, and pipeline initiatives like subcutaneous development, enhanced switch studies, and the azer-cell trial.

Q: Great. Congrats for the quarter and thank you for taking my question. Most of my questions related to BRIUMVI have been on third. And then maybe just a follow-up on the capital allocation for those additional pipeline. So one is in terms of the BRIUMVI expanding to MS indication, when you start the trial later this year and then would you be able to give us provide some proof concept data to support the plan? Number one. Number two is in terms of the allogeneic cell therapy. Do you expect to give us some data update next year? And then what will be the -- be the principle to share the data in terms of the number of patients and the maturity of the data? Thank you.

A: Michael Weiss said they are hopeful to start the azer-cell study later this year or early next year. The cadence of data from that trial is yet to be determined. Regarding BRIUMVI expanding to other MS indications, they are working toward enrolling non-MS patients in trials this year, but specifics were not detailed today.