Gilead Sciences, Inc. (NASDAQ:GILD) Morgan Stanley twenty second Annual International Healthcare Convention September 5, 2024 12:20 PM ET
Firm Members
Daniel O’Day – Charman & CEO
Andrew Dickinson – Chief Monetary Officer
Convention Name Members
Terence Flynn – Morgan Stanley
Terence Flynn
Thanks for becoming a member of us, everyone. I am Terence Flynn, the U.S. biopharma analyst right here at Morgan Stanley. Earlier than we get began, for essential disclosures, please see the Morgan Stanley analysis disclosure web site at www.morganstanley.com/researchdisclosures. More than happy to be internet hosting Gilead this afternoon, sorry. And now we have becoming a member of us Dan O’Day, the corporate’s Chairman and CEO; and Andy Dickinson, the corporate’s CFO. Thanks each for taking trip of your day to affix us.
Daniel O’Day
I actually admire having us right here.
Query-and-Reply Session
Q – Terence Flynn
Recognize the time. perhaps we would begin, I assumed excessive stage on sort of technique. Clearly, you have each been within the seat for a number of years now, and you have been reshaping and diversifying the corporate’s portfolio and pipeline. In order you look out, perhaps simply assist us take into consideration that transformation journey that you’ve got taken as an organization? And what is the subsequent part right here for Gilead? Like do you assume you have made all the mandatory investments? Or is there extra work to do as you take a look at the subsequent medium to long term right here?
Daniel O’Day
Sure, Nice. Thanks, Terence, for that chance. Joyful to begin and have Andy add. So thanks on your curiosity in Gilead as effectively. Once I got here to the corporate round 5 years in the past now, I believe we set — the workforce and I set it throughout a method to have a look at a extra sustainable diversified Gilead for the long run, proper? That was our goal. And inside that context, that meant sustaining, and really, I believe we have made a number of progress, not solely sustaining however rising our HIV enterprise, however diversifying then into different therapeutic areas as effectively.
So core to that — and to your level, Terence, I imply, we made key investments which have allowed us to sort of make actually a number of progress alongside that journey. And all the pieces I am going to discuss now because of these key investments. The primary one is virology and HIV specifically. And clearly, the latest information on len for PrEP is extraordinary for those who may gain advantage from PrEP. And in addition for the corporate as we take into consideration our longer-term ambitions in HIV. It permits us to sort of rethink your entire PrEP market from each a market dimension, market share, adherence standpoint. And so it is actually a complete totally different lens on the PrEP market.
And naturally, inside that virology, sustainability comes then the long-acting remedy market, which we’ll replace you on a bit of bit additional at an investor occasion later this yr. However suffice it to say that we’re actually inspired by the number of choices that now we have throughout that long-acting remedy market from even in a substitute for a once-daily oral to as soon as weekly oral to probably as soon as month-to-month oral to as soon as each three and 6 month subcutaneous injection. So over the course of this time period, after we take into consideration the sustainability half, with the sort of the closest main patent cliff being 2033 with Biktarvy and by that stage, having a really much less focus threat on Biktarvy due to all the pieces I discussed, we see this progress potential in our sustainable enterprise effectively into the late 2030s.
After which on the identical time, on a diversification technique, we spent a number of time diversifying the portfolio. Let me first simply speak about clinically the place we’re at. So we’re at a portfolio now that has 36 medical stage trials happening proper now in oncology and irritation. We now have 16 others in virology. And what you see right here is, I believe, an actual alternative to consider our portfolio in a really totally different manner than you probably did 5 years in the past. And simply speaking about a few of the near-term points, we have got Trodelvy in earlier line to breast most cancers, lung most cancers and another indications.
Once I flip my consideration to cell remedy, along with the work we nonetheless should do with Yescarta and Tecartus, the chance in a number of myeloma is important. I imply, a big market with a differentiated product with our associate, Arcellx, with a world-class manufacturing supply turnaround time group on a number of myeloma. After which perhaps the very last thing I am going to say is on the portfolio, after which it’s going to flip to sort of the industrial and near-term launches, is that we constructed up a Part II portfolio in oncology irritation. It is very totally different than 5 years in the past with some very, very attention-grabbing sort of novel mechanisms in there in irritation, alpha-4-beta-7, TPL2 after which an oncology CCR8. These issues are going to return by means of the pipeline as we proceed to have a look at additionally supplementing that appropriately with some bolt-on M&A and BD.
On the industrial aspect, once more, I believe the group has actually centered on delivering quarter after quarter. You’ve got seen it in our ends in our base enterprise, which is the best way we sort of measure the sturdiness of our enterprise transferring ahead. And we’re actually excited concerning the upcoming potential launches that now we have on prime of our sturdy base companies happening proper now. I might level your consideration to seladelpar, now referred to as Livdelzi, nonetheless rolling off my tongue nearly utterly.
I believe a very important alternative in PBC with a differentiated product, and Andy can dimensionalize that a bit of bit extra as we proceed the dialogue, preparing for len for PrEP and preparing for a number of myeloma. So now we have loads — and I’d say the pull-through on the cell remedy enterprise with Yescarta and Tecartus we’re nonetheless within the first couple of innings there on the industrial aspect. So we’re keenly centered on delivering that industrial execution.
All of this towards the backdrop of a altering funding panorama within the enterprise. We appropriately, I believe, invested considerably over the previous few years to create this medical and industrial reliability, sustainable and diversified machine. However now you see our self-discipline at this stage is leveraging our P&L, notably within the working margin expense and delivering now to the underside line such as you noticed within the second quarter. Whereas we’ll proceed to put money into the enterprise, we’re at a stage now that you may see the leverage that is coming by means of our mannequin. So backside line is, I believe the journey isn’t achieved. We now have extra to do. We’re 5 years into in all probability a decade lengthy transformation. However the progress is tangible, and we’re dedicated to that.
Terence Flynn
Okay. Nice method to begin it off and body all the pieces. I assume the one space is you may have been lively in enterprise improvement, together with seladelpar was, I believe, the latest one. How essential is that on the ahead now? Or do you are feeling like you may have sufficient substrate by means of what you have achieved and in addition your inside pipeline to sort of run at regular state from right here?
Daniel O’Day
Sure. Let’s get to Andy’s…
Andrew Dickinson
Sure, I am pleased to leap in and begin. Once more, thanks for having us. I might say that the straightforward manner to consider company improvement is that the subsequent 5 years and past will probably be when it comes to each the quantity of capital allotted to company improvement and the sorts of offers that we do will probably be totally different by definition. And a part of it, all of it goes again to Dan’s level that 5 years in the past, we needed to rebuild the pipeline from the bottom up, and we needed to actually lean into exterior alternatives, each peculiar course, licensing and acquisitions.
You quick ahead to the place we’re immediately. We now have a a lot deeper, richer pipeline that Dan alluded to. We now have numerous packages developing by means of the pipeline. A lot of which have been developed internally. I am going to use an instance, our oral alpha-4-beta-7 in immunology that’s in Part II. We now have a TPL2 inhibitor. We now have numerous packages that may require further sources that we’re enthusiastic about that dietary supplements our deep late-stage pipeline. So we’ll add to it over time, however will probably be extra peculiar course licensing offers. We’ll hold doing that.
As issues come into the portfolio, different issues will probably be popping out of the portfolio, we’ll keep the strain within the portfolio to make it possible for we’re taking probably the most promising packages ahead. And we’ll complement it with M&A over time. I believe the seladelpar acquisition from CymaBay is a superb instance of the sorts of offers that we wish to do, late-stage, derisk, excessive chance. We consider it is a misunderstood market that has important potential for us to develop roughly over the subsequent decade and perhaps past as we take into consideration life cycle extension and a number of synergies in that deal. So we needed to construct out the remainder of the corporate.
However should you simply step again immediately, we now have three rising franchises. We now have a rising HIV enterprise that is going to see further progress, each in PrEP and long-acting remedy. You’ve gotten a liver illness portfolio with hepatitis and now seladelpar in PBC, the place the hepatitis — viral hepatitis enterprise has stabilized. It is even been rising a bit of bit. Now you layer on significant progress from seladelpar and you’ve got a rising oncology enterprise, each in Kite and right here. We are going to add to all of these by means of company improvement. However once more, at a — in all probability a barely slower tempo and positively utilizing a lot much less capital, I’d anticipate going ahead than what we needed to do to rebuild it over the past 5 years.
Terence Flynn
Okay. Okay. Nice. There is a transition on the CMO stage at Gilead now. So what are you in search of when it comes to filling that place sort of qualities, experiences as you concentrate on the subsequent tier you are going to make a fairly essential position.
Daniel O’Day
Sure, terrific. I wish to thank Merdad. I believe the primary 5 years of the journey, his talent set round deep expertise in improvement, early improvement, late improvement throughout therapeutic areas helped us construct the portfolio aspect of the enterprise, however equally sort of the infrastructure inside the enterprise. We now have a really, very practical enterprise outdoors of HIV, which was Gilead’s candy spot in oncology and irritation and all of the disciplines we must be profitable, each clinically and commercially.
In order we take into consideration sort of the baton handing off to the subsequent CMO, will probably be someone who’s received a really sturdy expertise in improvement, late-stage improvement throughout the therapeutic areas that we’re centered on, someone who can take a company that’s nonetheless comparatively new in a few of these new therapeutic areas and refine these and produce them to a state of excellence that we’d like them to be at to ship. I am actually happy with the extent of inbound curiosity. It has been extraordinary. I believe it says loads about what the workforce has achieved at Gilead over the previous 5 years. And so we’re effectively into the interview course of, and we’re in search of this transition someday later this yr or early subsequent yr. So keep tuned.
Terence Flynn
Okay. Nice. Okay. I assume extra on sort of the enterprise aspect of issues, in all probability a query for Andy. Simply you guys have already commented on the Half D headwinds as we take into consideration 2025. And once more, I believe, Dan, you perhaps alluded to this, how are you excited about working margins for subsequent yr? I imply, you talked about a number of the ramp goes to occur. So it looks like any leverage could be pushed by sort of prime line progress, however would love your perspective right here as we get nearer to ’25.
Andrew Dickinson
Sure. I imply we do anticipate to have prime line progress subsequent yr. A few of that will probably be masked by the Half D reform. And once more, to place it in perspective, as I stated, we now have three rising franchises. The bottom enterprise grew 8% two years in the past, 7% final yr, 6-plus %, this yr. It is best to see accelerating progress with all of the launches by means of the tip of the last decade. All of that may give us leverage. And you then overlay, as Dan talked about, the rigorous value containment.
Now that now we have our expense base at a stage that we expect permits us to maintain innovation and keep progress and new product launches over time, you see important expense moderation over the past three quarters. And the second quarter, Terence, as you already know, is a superb instance of we beat on the highest line by 3%. Our bills got here in 12% beneath expectations and we beat on the underside line by 25%. We had a 47% working margin, which had improved, I believe, from 42% the prior quarter. It simply provides you a way of how a lot leverage now we have within the mannequin.
So though, to your level on 2025, a few of our progress will probably be offset by the Half D reform subsequent yr, after which we’ll develop proper by means of it. Past that, we nonetheless are concentrating on progress within the backside line. So extra to return, we have not offered steering but for 2025, as you already know. However we’re at all times excited about — we’re coming into a brand new chapter going ahead of not solely rising the highest line but additionally pulling it ahead on the underside line for the good thing about our shareholders.
Daniel O’Day
And that is at all times deliberate. I imply, Andy and I at all times have this plan. However in an effort to get to the sustainability and diversification, there was this time period of considerably overinvestment. After which now we’re within the optimization sort of leverage standpoint. So that is what we anticipated to be. Now we’re implementing and executing on that.
Terence Flynn
Does that — how does the dividend match into that should you’re getting extra leverage on the underside line? For money like how do you concentrate on…
Andrew Dickinson
Sure, we have been completely in keeping with the dividend. We now have a robust dividend. We anticipate to develop the dividend over time. You’ve got seen that. And we’re dedicated to the dividend, we’ll proceed to develop it. Nothing’s modified on the dividend. I believe we generate a lot free money circulation in our enterprise, and you have seen it range through the years, been wherever from $8 billion to $12 billion a yr within the final 5 years, if I keep in mind appropriately.
Our money builds again up shortly. You see that publish the CymaBay acquisition, you may see that by means of the remainder of the yr. It provides us a number of flexibility. We goal returning at the very least half of that to shareholders yearly by means of the dividend and share repurchases. However over time and it sort of tying it again to my earlier touch upon we’ll do further BD in company improvement, however our money will construct up so shortly, we might have alternatives to return extra money to shareholders both by means of opportunistic onetime dividends or share repurchase, however all of that will probably be decided by sort of the borrow down the street. However there isn’t any doubt, we’re very wholesome from a monetary perspective, and we see sort of with the accretive — sturdy progress profile going ahead that ought to completely proceed.
Terence Flynn
Okay. Nice. Perhaps transferring on to lenacapavir. Clearly, very thrilling information within the PrEP as you talked about, Dan. The second examine of PURPOSE II is popping out right here, I believe, later this yr, early subsequent yr. It’s a barely totally different inhabitants. And so I believe one query individuals have is simply how to consider efficacy on this inhabitants versus the PURPOSE I trial and any variations we have to take into account as we prepare for the subsequent readout?
Daniel O’Day
Sure, completely. And look, I believe after we designed this complete objective program, there’s 5 research in this system. It’s the most complete program when it comes to individuals that would profit from PrEP over that time frame. And I am happy with the group that we led and began with maybe the place the necessity is biggest, Sub-Saharan Africa, amongst this gender ladies and seeing that 100% efficacy is difficult to overstate the passion and the impression probably for public well being. Now everything of the PURPOSE program, and it bodes very effectively for the opposite PURPOSE packages. So the PURPOSE packages and PURPOSE II, specifically, is designed equally to PURPOSE I.
In different phrases, the target is to indicate a distinction between lenacapavir twice a yr versus background HIV an infection fee. I will not get all of the dynamics, however you have seen PURPOSE I, and you already know that, that system works and that trial design works. Now whereas the background HIV incidence fee for PURPOSE II, we anticipate may very well be decrease amongst this inhabitants, largely males which have intercourse with males in several international locations than Africa. We nonetheless assume that given the profile of lenacapavir that may bode very effectively towards regardless of the background fee is.
And the secondary endpoint is comparability of lenacapavir to Truvada, the place we all know there’s at all times adherence challenges with taking a once-daily capsule. In order that information will come late this yr, early subsequent yr. That types the submitting package deal. Most consultants that we speak to at IAS and elsewhere, say, we already know the product is there. However regulatory-wise, we’ll want each of these to file and transfer forward. So I believe we’re — we stay very optimistic concerning the impression this might have for the HIV epidemic internationally.
Once more, I’d simply level out that we actually, with this objective program, should rethink the best way you concentrate on PrEP as a result of immediately, it is used — and actually a really small share of the inhabitants that would profit. It is giant — it is nearly utterly in the USA. It is city areas, it is MSN communities, and it is these which can be educated and sort of within the know. And that is roughly round, give or take, round 400,000 people who profit from PrEP. So the chance to consider market dimension growth, new populations, new prescribers, new geographies linked with market share, Descovy and len linked with adherence, which immediately is roughly plus or minus 50%.
And that is onerous to get your arms round due to the usage of PrEP on demand within the oral setting, however we all know that goes — the adherence will go up considerably from the place it’s immediately to what we noticed as an illustration within the PURPOSE I examine. So there’s plenty of methods to construct out the concentric circles of how this PrEP market expands over the approaching years.
Terence Flynn
Sure. Okay. Nice. One enter, there’s some questions on simply pricing. Clearly, you may have a set level with Sunlenca within the remedy aspect. Now you may have the identical drug within the prevention aspect. These are totally different markets, and as you stated, totally different sort of segments, possible totally different payer combine, et cetera. So how do you method that pricing resolution on the PrEP aspect, given you have already got a longtime value within the remedy?
Daniel O’Day
Proper. So we have not mentioned precisely clearly how we will value len from PrEP but. However what now we have stated is we’re not going to make use of the HT, the closely remedy skilled sufferers as a comparator, should you like, for our pricing. We’ll be utilizing PrEP comparators for our pricing for len for PrEP pricing. I believe that is about what we will say proper now at this stage. And with a concentrate on entry and increasing that inhabitants. I imply that is…
Terence Flynn
Sure. What — I imply how do you modify that payer mindset? As a result of once more, I have been stunned that there is nonetheless generic Truvada about half the market proper now in prevention. So what’s sort of the totality of the argument that you simply guys are bringing to the payers now in order that a few of these obstacles come down? As a result of after we speak to a few of the payers, they proceed to assume that generic Truvada is an efficient choice regardless of the adherence challenges. And so how do you persuade these which can be nonetheless prioritizing that as sort of like — it is not likely a line of remedy, but it surely’s a frontline choice and persuade them that like each six months is the higher one to go together with and alter that dynamic.
Andrew Dickinson
Sure, it is an important query. I believe it is comparatively simple. I imply it is the medical information. I imply, the PURPOSE I medical information exhibits definitively. And also you noticed this in one of many competitor research in long-acting PrEP additionally confirmed that though the orals work very effectively in the event that they’re taken every day, they don’t seem to be taken every day in the actual world. The truth is, they’re taken 50% in some sufferers much less of the time, some sufferers extra, however you do not get the identical profit from an efficacy standpoint. So you may have an important security profile from lenacapavir, you may have extraordinary efficacy, 100% efficacy, as Dan highlighted, you’ll be able to’t do higher than that. It provides us a really sturdy argument.
And there is a sturdy pharmacoeconomic argument because of that as effectively, which not solely we expect will resonate within the U.S., but it surely ought to resonate outdoors of the U.S. the place Dan stated there’s an actual alternative to deliver HIV prevention to Europe and Asia and different markets. The perfect analog, keep in mind, I imply, should you return after we launched Descovy, when Descovy was accredited for prevention, I believe it was roughly 3.5 years in the past, and Truvada went generic, we had — we maintained very excessive formulary entry for Descovy over time.
And the extent of innovation — I imply, Descovy, the info, particularly in long-term continual remedy, there’s a important distinction and good thing about Descovy in a sure smaller variety of sufferers with a few of the unwanted side effects. The — however we have been in a position to keep formulary entry with Descovy with a stage of innovation that what we’re speaking about was a bit of bit totally different. What we’re speaking about here’s a step perform change in innovation.
One in all our shareholders use the analog of — in remedy transferring from the multi-pill regimens to Atripla in 2006 or 2007, that was an entire sport changer for the remedy market. And also you noticed that each when it comes to the entry, but additionally what it did to open up the market. And I believe it isn’t an ideal analog, but it surely’s a very good analog for what we’re speaking about right here. However the easy reply is you’ll be able to’t do higher than the PURPOSE I information, and that ought to give us a really sturdy set of speaking factors with the payers, not solely in the USA however globally.
Daniel O’Day
I imply perhaps two fast add-ons as I agree with it. I imply one is, keep in mind, it is a group whose voice has heard strongly amongst payers. I imply — and when you may have one of these information that would probably have full prevention of HIV. I believe that will probably be taken into consideration. And so we do not anticipate that we will have a number of dialog with payers over this. And the opposite factor I’d say is outdoors the USA, the place there actually hasn’t been a number of urge for food for reimbursing something aside from generic PrEP and even there, there’s been restricted urge for food.
With the PURPOSE I information, we’re beginning to have conversations with different international locations and say, Oh, wait a minute. Now that is actually totally different. And people are extremely HTA, after all, pushed international locations. So I believe to Andy’s level, the info will change the financial dialogue in a manner that I believe may very well be very, very useful to international locations world wide and folks may gain advantage from PrEP.
Terence Flynn
What does that ex U.S. market appear to be? I imply you talked concerning the 400,000 within the U.S. increasing from there, however what is the theoretical relative dimension of sort of G7 or no matter that you simply look to sort of construct out?
Daniel O’Day
I imply, in all probability the best way to consider that simply when it comes to the way you would possibly mannequin that is the very first thing nearly in the USA due to the 400,000 sufferers immediately. And should you have been to consider that as a very branded market, that will be a $3 billion-plus market immediately, proper? After which should you have been simply low-hanging fruit, take into consideration getting the adherence from 50% to larger and penetrating that market additional, you’ll be able to — that would go to a $4 billion, $4.5 billion market at that stage.
So I believe the U.S. will proceed to be a disproportionate dimension marketplace for HIV PrEP undoubtedly. However again to your G7, I imply the populations, I believe everyone understands there, it could be totally different nation to nation. So we’ll see the place that goes, and we’ll see how that performs out. However I do assume it’s important to take into consideration this each when it comes to increasing customers, prescribers and geographies to do the mathematics utterly. I do not know if you wish to add…
Andrew Dickinson
Sure. I imply, I’d simply add that the 400,000-plus individuals which can be — these are individuals taking PrEP immediately. And we’d — each — it is in a really slender inhabitants. And to Dan’s level earlier, that is the place to begin. So the best way to consider the 400,000 sufferers or whether or not that is $3 billion to $3.5 billion branded, you then add on the compliance. It is a $4 billion to $4.5 billion alternative out of the gate to take individuals which can be utilizing PrEP immediately to transform them as shortly as attainable to a greater long-acting choice. And you then develop the market from there.
So your query on Europe, the market in the USA ought to increase considerably, each within the conventional market of males having intercourse with males, however into ladies, anybody liable to that has a number of sexual companions as a goal is a chance to stop HIV unfold there as effectively. After which outdoors of the USA. I imply the place to begin within the U.S. is greater due to the usage of PrEP, however the dimension of the market, each within the U.S. and out of doors of the U.S. is way, a lot bigger than that quantity immediately. And now we have years to sort of construct that market over time. Will probably be a novel market to construct, however there is a good place to begin…
Daniel O’Day
And it’ll take years to construct.
Terence Flynn
Okay. Nice. Perhaps only one extra earlier than we go over to oncology is simply Biktarvy. I believe the patent within the U.S. expires in 2033. You guys are engaged on once-weekly oral regimens. You talked concerning the innovation going again all the best way to the preliminary single-tablet routine that Gilead launched is a once-weekly oral one other sufficient of a step perform change to sort of proceed to transition the market over? Or there’s it’s important to get to a as soon as each 4 months or one thing within the remedy aspect or six months?
Andrew Dickinson
It is actually for some sufferers is a step perform change. So — and once more, market analysis will counsel that that is comparatively simple, however a once-monthly oral might be extra fascinating than as soon as weekly, all of it will depend on the sufferers. However perhaps the large image that is essential is now we have line of sight now with our packages which can be both within the clinic as potential associate brokers for lenacapavir or brokers that will probably be coming into the clinic. Keep in mind, lenacapavir is exclusive, and it is so potent and we have already formulated as a once-daily capsule, a once-weekly capsule, we will formulate it as a as soon as month-to-month capsule or a prodrug of it, each three months subcutaneous each six month subcutaneous and perhaps each 12 months.
So then it is all about discovering associate brokers for remedy so that you’ve got at the very least two totally different medicine on board. I’d say immediately, we’re centered on all of these. We now have two packages which can be as soon as weekly tablets, one’s in Part III in partnership with Merck. One is a completely owned program in Part II. Each of these are thrilling. The — our wholly-owned program contains our proprietary integrase inhibitor that we expect is de facto thrilling. That will probably be a significant step perform change for some sufferers.
We now have — I might say immediately, our scientists would say that we’re a lot nearer to a as soon as month-to-month capsule for remedy than we thought we would be 12 months in the past, which is thrilling. After which now we have numerous brokers within the clinic are coming into the clinic for the long-acting subcutaneous remedy. So all of these will probably be step perform adjustments that each 6-month injections or yearly, if you will get there and the as soon as month-to-month capsule in all probability are the most important alternative for step perform change, however all of it’s additive to our enterprise.
Daniel O’Day
And alongside that journey, we have stated we might have the len for PrEP accredited as early as very late 2025. And probably options for remedy, together with the once-daily bic/len or the as soon as weekly orals in 2027. So a few of that is close to time period, a few of this — however the area strikes shortly. I assume my level is, I believe by the point we get to a patent expiry of Biktarvy in 2033, we can have decreased the focus threat considerably on Biktarvy within the remedy inhabitants with a wide range of totally different choices.
Terence Flynn
Okay. Understood. Perhaps transferring on to oncology. Simply as we take into consideration the ahead outlook for Trodelvy, is that also the cornerstone of your technique right here in oncology?
Daniel O’Day
Sure. Look, I believe when you concentrate on our oncology enterprise immediately versus what it was three years in the past, it is now a $3 billion run fee enterprise whenever you take a look at each cell remedy and Trodelvy, and it is producing about half of our quarterly progress on that line. So I take into consideration the holistic nature of our oncology enterprise. I take into consideration the cell remedy alternative at round $2 billion immediately, we’re nonetheless in perhaps the primary or second inning of the place we will go together with Yescarta and Tecartus due to — it is nonetheless penetrated in a small share of sufferers may gain advantage from this probably healing remedy.
I take into consideration a number of myeloma is a probably near-term alternative with our world-leading cell remedy enterprise. I take into consideration Trodelvy in breast most cancers and transferring up in earlier strains of breast most cancers and increasing into different tumor varieties, together with probably lung and in addition cancers like endometrial. After which I believe additionally concerning the Arcus optionality with our Silent TIGIT program and different oncology packages inside our Arcus collaboration. So I take into consideration the holistic nature of an oncology enterprise that’s nonetheless creating nonetheless very early with plenty of optionality as information readouts come.
Terence Flynn
Okay. Nice. Perhaps simply to drill in on the Trodelvy dynamics years. Clearly, there’s some competitors from in HER2, you may have Dato-DX probably coming. So simply confidence stage within the breast most cancers setting and persevering with to sort of develop that chance after which the considerably associated query is lung most cancers, you talked about, Dan. This clearly second-line setting, seems like not going ahead, first-line trial ongoing confidence stage within the first-line lung setting. So sort of two half on Trodelvy.
Daniel O’Day
Sure. So look, in breast most cancers, and you have seen a few of this information. However first, I am going to remind you, we’re the one TROP2 ADC accredited in breast most cancers, triple-negative breast most cancers, hormone receptor constructive HER2 unfavourable. They’ve very totally different dynamics, these two indications in breast most cancers. In triple-negative breast most cancers, we see sturdy market share uptake in second line and past. We have the info readout or an replace, I’d say, on the first-line triple-negative breast most cancers later this yr. So we’ll offer you an replace on that.
And again to your level, I imply, that roughly doubles the affected person inhabitants as you go from second line plus into first line with triple-negative breast most cancers. We’ll see how these outcomes play out. And now we have the identical kind of need to maneuver up in strains of remedy and hormone receptor constructive HER2 unfavourable. Fortunately, for sufferers, it’s aggressive. There’s a number of choices. And presently with Trodelvy, we play within the IHC-0 inhabitants there effectively or maybe after different therapies in strains of therapies.
However we expect — and that IHC-0 is round 30%, 35% of the HR-positive, HER2-negative. We now have research ongoing to see how we’ll carry out in earlier strains of remedy, notably within the IHC-0 inhabitants. So I believe that is sort of the breast most cancers alternative. Once more, as you progress up in strains of remedy, rising the affected person populations. And we nonetheless have a number of work to do to alter the chemo desire sort of that is been developed over years in each these indications. However the OS information is a robust information to sort of change these patterns and people behaviors.
Lung most cancers, once more, I consider that what you noticed at ASCO this yr on the EVOKE-02 information, which is the Part II program in second-line lung most cancers. And specifically, at ASCO, you noticed the PD-L1 high-expression inhabitants, the place we mix Trodelvy with KEYTRUDA within the first-line lung most cancers provides us a number of confidence across the ongoing EVOKE-03 trial, which, once more, is in that PD-L1 excessive affected person inhabitants. You are going to see a bit extra information on the broader attribution of Trodelvy in non-small cell lung most cancers at World Lung developing, totally different cohorts. However I’d say considered one of our strongest potential alternatives is in that PD-L1 excessive with the continued EVOKE-03 trial.
So we’ll be data-driven round this. We proceed to have a number of confidence in Trodelvy, the place we have seen its impression and impact within the OS information that now we have in our palms. And we’ll construct upon that as a result of Trodelvy as a medication inside our portfolio might probably be mixed not solely with PD-1 — PD-L1. We’ll see what occurs with TIGIT, however there’s potentialities for a number of totally different mixtures with Trodelvy transferring ahead.
Terence Flynn
Okay. Nice. Perhaps simply within the final couple of minutes as a result of once more, one other focal pipeline property that have to promote in myeloma. Once more, you referenced this in your opening remarks right here, remind us sort of the goal profile that you simply’re aiming for on this upcoming pivotal information set. And once more, I believe you guys have confirmed that will probably be at ASH. However perhaps simply remind us sort of the way you’re excited about profile.
Daniel O’Day
[indiscernible].
Andrew Dickinson
Certain. Sure. No, I am pleased to take it. It is a actually thrilling program partnered with Arcellx. It is what we consider seems like a next-generation BCMA cell remedy that is presently in fourth line plus examine. We simply began a second line plus examine as effectively. At ASH this yr, you are going to see the primary set of information that we consider will sort of as a extra apples-to-apples information comparability towards the CARTITUDE I examine from one of many accredited rivals. So it’s totally thrilling. I imply, to date, we’re seeing actually sturdy efficacy, together with within the Part I examine of roughly 38 sufferers, I consider, unbelievable efficacy and actually troublesome to deal with sufferers, together with these with a number of extramedullary illness.
Most significantly, we reiterated this on our second quarter earnings name in Arcellx as effectively. We now have seen no neurotoxicity thus far. And we have handled sufficient sufferers. You usually, as I perceive it from our clinicians, see the event of neurotox within the first month or two after remedy. We had the unique Part I examine. We’re now effectively by means of sort of the second examine, it is a lot larger examine that we’ll be presenting at ASH and haven’t seen any neurotox thus far. So there’s a number of pleasure. I imply, what we have at all times stated is it is a very massive alternative for us in Arcellx even when we’re simply pretty much as good as the present accredited cell therapies, if we’re higher on efficacy or security, not to mention each, which we expect now we have the likelihood to be, it is even an even bigger alternative.
Order of entry, I stated this not too long ago in one other kind, order of entry is much less essential, I believe, in cell remedy, on condition that it is a onetime bespoke remedy. And so if in case you have a best-in-class asset and one that you may manufacture shortly and reliably, which as you already know, Kite has the world’s greatest cell remedy manufacturing. It is actually an unbelievable aggressive benefit for us actually provides us a number of conviction across the dimension of the chance. So we’re, to be clear, very enthusiastic about it. Look ahead to sharing information at ASH and assume this may very well be one other massive progress driver for us in our oncology portfolio.
Terence Flynn
Nice. Properly, I believe we’re up towards time. However thanks, Dan. Thanks, Andy. Actually admire it.
Andrew Dickinson
Thanks for having us.
Daniel O’Day
Thanks. Recognize it.
