Earnings Call: H1 2021

Aug 31, 2021

Good day and thank you for standing by. Welcome to the Everest Medicines Earnings Call. At this time, all participants are in a listen only mode. After the speakers' presentation, there will be a question and answer session. Please be advised that today's conference is being recorded. I would now like to hand the conference over to your host today, Mr. Ziyi Chen, China Healthcare Analyst, Goldman Sachs. Please go ahead. Sure. Thank you. Good morning, everyone, and welcome to Everest Medicine's Interim Results 20 21 Corporate Update Earnings Call. And Goldman Sachs has appeared to host this call. This is the Chen China Healthcare Helms at Goldman Sachs. As a reminder, this call is being recorded. So before we kick off the session, I have to read out a disclaimer. This call is strictly for classic Goldman Sachs only and this conversation is not intended for the media and are off the record. Participants will be removed from the call if they cannot be properly identified and this call webcast is not for the purpose of sharing or receiving non popular or otherwise confidential information. Attendees are publicly signed market participants who may not receive and should not request non popular or otherwise competition information about issuer or security or about the markets for securities. So joining me today from the company are CEO, Kerry Branchett President and CFO, Yan Wu and our COO, Neil Zhang, who will also be joining us for the Q and A portion of today's call. I would now like to turn the call over to Yihang Zhu, the Manager of IR from Everest Madison. Please proceed. Thank you, Sunyi, and good morning, everyone. We issued a press release with half year twenty twenty one interim results before the call, and it is available in the Investors section of Ariston Metals website. Speakers of this conference call may make statements that constitute forward looking statements, including descriptions regarding the intent, beliefs or current expectations of the company or its officers with respect to the business operations and financial condition of the company, which can be identified by terminology such as will, expects, anticipates, future, intends, plans, beliefs, estimates, confidence and similar statements. Such forward looking statements are not guarantees of future performance and involve risks and uncertainties, and actual results may differ from those in the forward looking statements as a result of various factors and assumptions. The company or any of its affiliates, directors, officers, advisers or representatives has no obligation and does not undertake to revise forward looking statements to reflect new information, future events or circumstances after the date of this conference call, except as required by law. I will now turn the call over to Everest's CEO, Harry, to discuss our business update and outlook. Thanks, Yiheng, and good morning, everyone. Thank you for joining us today to review Everest's 2021 interim results and recent business highlights. 2021 has been a highly productive year for Everest Medicine. As we continue to drive progress toward our corporate goals across all pillars of our business, we have successfully submitted an NDA for eravacycline in complicated intra abdominal infections and a BLA for zakatuzumab covatecan in second line plus metastatic triple negative breast cancer. Meanwhile, we are rolling out our commercialization plan and building up our commercialization infrastructure to ensure the successful launch of our products as they receive regulatory approval. We are also making good progress advancing our other pipeline products into and through clinical development. In addition, we have hired Doctor. Jennifer Young as our Chief Scientific Officer to lead the establishment of a robust discovery organization. Furthermore, we are well on track for the construction of our GLP production site in Jiaxuan in Zhejiang province of China. Looking ahead, we are very excited for several key near term milestones and the next phase of growth as a commercial stage company. Finally, we continue to be active on the business development front, evaluating multiple strategic opportunities and hope to complete 2 to 3 in licensing deals and R and D partnership and other strategic transactions before the end of the year. To start with our anchor product in the oncology therapeutic area, sacrotuzumab govitipan, our BLA submission for the treatment of second line plus metastatic TNBC was accepted by the China NMPA in May of 2021 and we received priority review for the submission. We're very excited to prepare for a potential launch in China anticipated in the first half of twenty twenty two. We believe sacrotuzumab gobletikam has been significantly derisked after our partner, DILIANAD, received full USA FDA approval for the treatment of adult patients with 2nd line plus metastatic triple negative breast cancer in April of 2021. Our Phase IIb bridging study of sacrotuzumab govitecan in metastatic triple negative breast cancer in China completed enrollment well ahead of schedule, and we expect to announce top line results in the second half of twenty twenty one. In addition, we received pediatric and rare severe disease priority review designations by the Taiwan FDA for sacrotuzumab, govitecan in second line triple negative breast cancer and orphan and fast track designations for metastatic triple negative breast cancer from the Ministry of Food and Drug Safety in South Korea in May of 2021. In January 2021, we submitted an NDA to the HSA of Singapore for sacrotuzumab with vitecan for the treatment of second line triple negative breast cancer and are preparing NDA submissions for the same indications in South Korea and Taiwan in the second half of twenty twenty one. Moving to a hormone receptor positive HER2 negative breast cancer, we expect to complete patient enrollment of our full powered Phase III ASIA study in early 2022. This trial is currently enrolling across sites in Mainland, China, Taiwan and South Korea. For urothelial cancer, Gilead received accelerated approval from the U. S. FDA in April 2021 for locally advanced or metastatic urothelial cancer following a platinum containing chemotherapy and the PD-one or PD L1 inhibitor. As part of the collective effort to make this innovative drug available to patients around the world, we started patient enrollment in China as part of Gilead's global Phase III confirmatory trial in August of 2021. Working with our partner Gilead, we endeavor to develop sacituzumabfogatecan broadly across a number of additional cancer types that overexpress TRO2. In March, China's NMPA approved a CTA for the Phase II basket trial in 180 patients with relapsed refractory esophageal squamous cell carcinoma, gastric cancer and cervical cancer. We expect to initiate this study in the second half of twenty twenty one. Looking at our cardiorenal therapeutic area, we completed Chinese patient enrollment as part of our partners, Caladitis' Phase III global registration trial to evaluate NEPICON as a treatment for IgA nephropathy. We expect to have proteinuria data readout in Chinese patients in the first half of twenty twenty two and are preparing to file an NDA in China following the readout in 2022. I also would like to highlight that our partner, Caladitas, submitted an NDA to the U. S. FDA for Mephiton for the treatment of primary IgA nephropathy with the PDUFA date of September 15, 2021. Calavitas also filed an MMA to the EMA for NEPICON for the same indication. If approved, NEPICON would be the 1st ever drug with the label for IgA nephropathy. Moving to our infectious disease portfolio. 1st, we have eravacycline. And as I previously mentioned, the NDA for eravacycline in complicated intra abdominal infections was accepted by the China NMPA in March of 2021. In addition, China NMPA approved the CTA for eravacycline for the treatment of community acquired bacterial pneumonia. In addition to eravacycline, we expect to have top line readouts results readout for tanaborbactam, a novel injectable beta lactamase inhibitor in the first half of twenty twenty two. For corporate updates, in the first half of twenty twenty one, we have also focused on initiatives in 3 key areas commercialization, discovery and manufacturing. We are building an industry leading commercial team with 3 business units in Mainland China focused on oncology, internal medicine and infectious disease under the leadership of Kevin Guo, who joined us as Chief Commercial Officer in February of 2021. We have also expanded our geographical footprint with newly established offices and general managers in South Korea, Taiwan and Singapore to ensure commercial success in those markets. With Jennifer Young, our Chief Scientific Officer joining us in April, we are actively building our discovery team by recruiting experienced talents in drug discovery and translational medicines and exploring new modalities and technology platforms to accelerate our discovery efforts. Our new research laboratory in Jiangjiang, Shanghai is expected to be fully operational in the Q1 of 2022. Furthermore, we are making steady progress on the construction of our global manufacturing site in Jiaxian, Zhejiang. Our Phase 1a of the facility construction, including quality control and the office building, is expected to be completed in 2022 and Phase 1b containing production, repassaging and warehouse is expected to be complete in 2023. We will continue to expand our innovative drug portfolio in areas of high unmet medical needs through in licensing and building of organic discovery capabilities. Our business development team is actively working on a number of licensing, research collaborations and partnership transactions across our therapeutic areas of focus, which complement our existing portfolio and offer opportunities for commercial synergy. With that, I will now turn the call over to Ian Wu to review our financial highlights. Ian? Great. Thank you, Cary. So I will now review the financial results for the 6 months ended June 30, 2021. And please refer to our interim results announcement from yesterday before some of the detailed numbers. So as of June 30, 2021, the group's cash and cash equivalents was RMB3.971 1,000,000. Net loss for the period decreased from RMB240.4 million from RMB623.5 million for the 6 months ended June 30, 2020 to RMB383.1 million for the 6 months ended June 30, 2021. This is primarily attributable to changes in fair value of financial instruments issued to investors. Adjusted loss for the period increased by RMB 57,200,000 from RMB 245.9 million for the 6 months ended June 30, 2020 to RMB 303.1 million for the 6 months ended June 30, 2021. This is primarily attributable to increase in R and D expense and distributions and the selling expenses related to the build out of our commercial organization. Moving on to specific line items. Research and development expense increased by RMB89.8 million from RMB161 1,000,000 for the 6 months ended June 30, 2020, to RMB250,800,000 for the 6 months ended June 30, 2021. This is attributable to 3 factors: number 1, additional clinical trials for our drug candidates number 2, continuing the expansion of our R and D team and number 3, the establishment of our internal discovery platform for in house R and D capabilities. General and administrative expenses increased by RMB6.1 million from RMB101.3 million for the 6 months ended June 30, 2020 to RMB107.4 million for the 6 months ended June 30, 2021. This is primarily due to increases in employee remuneration in connection with organization expansion. Distribution and selling expenses increased by RMB32.9 million from RMB9.2 million in the 6 months that ended June 30, 2020 to RMB42.1 million for the 6 months ended June 30, 2021. This is primarily due to the buildup of our commercial team and pre launch activities for the commercialization of upcoming products that we expect to be approved and launched in 2022. Finally, I would like to just highlight the fact that the company stock was included as a constituent stock of the small cap index, the 50 All Cap Index and the 50 Total Cap Index in the Global Equity Index series. This concludes our prepared remarks for today. I will now pass the call back over to the operator for questions. Thank you. Thank you, Carrie and Ian. So operator, please remind participants how to raise questions. Thank you. Certainly. And alternatively, if you wish to send the for me to raise a question on behalf of you, you can also send the questions over to me through email. My email address is ciyi.chenjs.com. So before we're waiting for questions, I actually got 2 questions to start with. Number 1 is definitely a lot of investors are looking forward to more BDDOs. As Gary just mentioned that we're looking at potential 2 to 3 more BDDOs in the second half this year. Well, I think it's more like in the upcoming 4 months. So any color on that? And could you elaborate a bit more about what kind of specific areas you will be looking at? What kind of stage of assets we'll be looking at? Any potential timeline for that. I think this is one of the questions we have keeping asking. And broader, on top of that, I think still we're trying to understand a bit more on the overall BD strategy over next few years and also things coming and also ramping up the in house discovery capability. So trying to understand a bit more about how you're going to balance the resources between those two efforts, the BD and also in house discoveries? And also in the in house discovery part, any progress on the team build up? And also any specific areas we'll be looking at for the in house discovery? Thank you. Okay. Thank you, Zvi. This is Carey, and I will start with these questions. For the I'll start with the second question first, which is the overall BD strategy and portfolio expansion and strategy over the next few years and the balance between organic and inorganic growth. So from the licensing perspective, we have not changed our direction substantially and that we still firmly believe that global innovation with 1st in class or best in class assets is the target zone that we pursue. And we also spend most of our attention on assets that have achieved a critical proof of concept. So these are later stage assets usually in Phase II or even early in Phase III. So as in the past, 6 of 8 of our assets fall into those categories. And I would say we maintain that same kind of ratio. We are spending some time looking at earlier assets, things that are in Phase 1 or early in Phase 2. These carry a higher risk profile, but also have a substantially different value proposition in taking assets to POC and with the opportunity with earlier assets to try to gain access to some of the global economics rather than just China and regional economics. From the Discovery side, the team is growing well. Jennifer has hired the bulk of her leadership team. This is today about 10, 11 people. And of course, we have to build out our lab in Zhejiang and Zhejiang High-tech Park in Pudong, Shanghai. So that space has been acquired and is being fitted out now. And currently, the team is working on their early projects and starting the strategy for the discovery area. We are really modality agnostic with my experience and Jennifer's experience in crossing small molecules, large molecules, ADCs and ethaneucleic acids. And so we're much more focused on the target category than we are on the modality because modality changes depending on the target. But we do have interest in ADCs. We have because we have one of the leading ADCs in the world today with Trinaldi, our second dose medical to TCAN. And so we would like to enhance our capabilities in that area. So that team is growing quickly and I think in the right direction. As far as the balance between license and in license, of course, the next 2 or 3 years will be largely in licensing. Discovery takes some time to move from projects initiation to clinics. And we think our first assets will approach clinic in the next 2 to 3 years. And I would say if we think about the whole size of the discovery organization, we expect it to be in the neighborhood of 40 to 60 people when it is complete. So that's my answer to the second question. To the first question on some more character about the near term deals. We have a very active duty plate right now with multiple deals that we are in or have completed due diligence. And these deals cross all of our therapeutic areas with a focus on real disease and on oncology and on infectious disease. We are looking and have very active deals in all of those areas. And the spectrum of the deals range from a clinical development perspective, from assets that are in early Phase II to assets that are ready to go to Phase III. So that's about the answer to the question, Wamsi. Ian or Neil, do you have anything to add to the questions or to the answers? Yes. Maybe I'll just add a couple of quick points. One is that I think as the management team think about our approach to business development, I think maybe 2 years ago, we would just be talking about in licensing transactions. And today, we also we still talk about in licensing, but I think what we can do on the business development front is a lot broader, right? We could do R and D collaborations. We could explore more strategic transactions. We can still look at late stage assets. We could also look at earlier stage opportunity. And whereas the last 4 years, we've been really looking at assets with regional rights, today, we are there are a number of opportunities that we're in late stage discussions with that will have global upside or global rights. And I think this is just because of the scale and the expertise that the company has gained over the last 4 years and really has accelerated with the build out of our discovery organization. And that allows us to expand really the range of opportunities that we could look at. And that will also allow us to create shareholder value, not just from our core regional territories, but potentially with global upside as well. Now these sort of R and D collaborations that potentially could allow us to access to enabling technologies could be very strategic and really position our the company well for the next phase of growth. Sure. Thank you. Thank you, Carrie and Ian. Operator, let's open the line. Certainly. The first question we have is from Hsing Wu from Morgan Stanley. Your line is now open. Hello. Thank you for hosting this company's call and thank you management for taking my questions, congratulations on all the progress you guys made with the customer. I have 2 quick questions. The first is about your commercialization plans for all the assets in China, in Korea and other places. Do you envision like a multiple chief medical officer to be in charge of kind of balance of product investment address or some other product remains going to keep this maybe paying third party to share new products. That's number 1. Number 2, it's about your buyback plan. You just announced validated, I think, for about company, US100 $1,000,000 I understand that you and the many people have seen so far, but where is the start? I'm just not sure. Like what's the time line and it could be probably this $100,000,000 and I call this a start going up and you can't set any point and how this happens soon. And the other point there, buying back stock may not have always been necessary at this idea. When Bill funds grow tough, those Fancy Music and the way IPS announced huge buyback in the past and now less than half of them when they announced the price buyback. Of course, I think that this year should have improved our company because our rental revenue is strong in the way our markets and the $100,000,000 to get us to paying off a lot of deals. Okay. Thank you. Thank you so much for your questions. I'll take the second question first on the stock repurchase. Just to be clear, it's HK100 $1,000,000 not US100 $1,000,000 And so it's a substantially smaller amount of yes, so it's Hong Kong dollars. And you covered the points well, I think. We certainly believe our stock is significantly undervalued and that our Board believes that the share repurchase under these current conditions demonstrates our confidence in our business outlooks and the prospects for the company. And this we're authorizing just 2% of our cash balance for repurchase. And we believe that we can replenish cash balance in the future at a lower cost of capital. So I think those are the sort of the simple answers to that question. From the first question about our commercialization and general approach, without question, we will only have one Chief Commercial Officer, that's Kevin Gwa, very talented, very experienced gentleman, was the previous BU2 leader at Roche and was an executive at Eisai in China and globally, decades of experience in many therapeutic areas. So one of the benefits of Kevin is that he has been in the antibiotic area. He's been in vaccines. He's been in cancer. He's been in renal disease. So he has a broad experience, including deep experience from Roche in breast cancer, where he led the commercialization efforts for Herceptin and for Xeloda. So we believe he's the right person. He certainly demonstrated that in his time here in putting together a great team. Our team structure under Kevin is set up in a BU fashion for oncology, for infectious disease and for internal medicine. The international group comes in through under Kevin, which is led by Alex Wong, a talented experienced person with a background from in Asia. And so that's how our structure will work in China. Certainly for oncology, we intend to build that sales force entire and commercialization force ourselves, same for Methicon. In other therapeutic areas, we have not completely decided the model, but the marketing, central marketing access, government affairs, medical affairs, all those functions would be internal to our company. Ian, Neil, any clarifications on these answers? Not from me. No, I think you answered. Great. Thank you for your questions. Yes, I would like that part. Actually, I think I've seen the RMB 100,000,000 of the U. S. Let's move to the next one. Thank you. Next one is from the line of Yang Wang from Credit Suisse. Your line is now open. Thanks. And thanks for looking in opportunity to ask questions. I have 2. First one is about our TRUDAV clinical development strategy in China or in Asia. So we can see for HR positive and HER2 negative breast cancer, we are working on Phase III trials in Asia, China and other countries. But it seemed to be our partner, Gilead, is also running a Phase III trial, global trial, which is going to have a readout in the second half this year. And so my question is, why do we want to run kind of an independent second Phase III trial in Asia country. Let's see, of course, we hope that those trials will be positive, but what if 2 trials give us different results and will that kind of affect our registration strategy? Now they seem to be the only M3 trial we are growing in Asia independently in Asia for Chodong. That's the first one. Second one is related to our NatCon drug. So we see early this year FDA approved a GLT-two drug for CKD patients for severe kidney function deterioration. And so I want to understand the SGLT2 drug approval in CKD approval, how much kind of indication overlapping with our nephcom potential indication? Thank you. Great questions. Thank you very much. For the TRYVELTY question, we certainly prefer when possible to join global trials and to have China contribute 15% to 20% of the patients or maybe more depending on the indication to the global trial. I think that is the this is the most efficient way to do development. But there are some situations where that's not possible. In the and one of the common situations is that a comparator drug or standard of care may be different between China and the rest of the world. And that is part of the case with hormone receptor positive HER2 negative. So at the time when that trial started globally, the CK4six inhibitors had not penetrated well. The only approved one at the time was palbociclib from Pfizer, and it had been approved, but had very low penetrants in China. And so the treatment paradigm is actually quite different. In China, patients fail hormonal therapy and then they go directly on to the single agent chemotherapy, whereas in the United States and Europe and Japan, they're treated either sequentially with hormonal therapy and AK-foursix inhibitors or in parallel and fail and then they go on to chemotherapy. So the patient populations are slightly different. That's caught up with time, but the trials have to start when the trial starts and that was the predominant behavior clinically in China at the time. So it was quite a difference. And so we elected to do a local trial, a regional trial, where we can interrogate both the population that is CDK4six experienced and CDK4six inexperienced. So we think that gives us some give us great data to add to the global data that we're expecting will read out sometime in the next few months from the Gilead side. So that was the reason. In the future, unless the cancer is any predominantly Chinese cancer, where it may not make sense to run a global trial If it's a part of the global CDP clinical development plan, we would prefer to join the global trials and help with global enrollment. So the second question about NEFCON and SGLT2 inhibitors, that's a great question. As you probably remember, I was at Lilly Health, helped with the development of epicliflozin, one of the SGLT2 inhibitors. And they're a great addition to the armamentarium for the treatment of both cardiac failure and chronic kidney disease. The overlap with IgA nephropathy is minimal or non existent. IgA nephropathy is a very particular type of kidney disease caused by an abnormal IgA that leads to glomerular damage. And this is very different than the types of kidney disease that are being treated with SGLT2 inhibitors. So we don't expect it to be substantial for that. That's a great question. Okay. So I just want to add on the as to the SDRP2 question, I mean, what we think that we're preparing the launch for NAPTICOM. But as we look at the market, it's very, very deep market. Currently, despite optimal standard care treatment, that's primarily lasting division, the supporting area of average patient is very high. And then the patients the physicians that we see in China don't really have a treatment goal. And then even it would be very easy for us to push down the treatment goal from somewhere above 1 gram from urea per day to say like a 0.5 gram per day. But even if you look at other renal diseases, for example, DKB, there are drugs out on the market that are pushing for XinyuGo of less than 0.3 3 grams per day per year. So that's minimum code of work. So to get to so there's abundant scientific data shown for putting unit targets, the lower the better. And then to get to an optimal treatment, we think the market is big enough to allow multiple agents to play. And we're actually looking at other very promising treatment modalities for IJ antibodies typically. And it will be a market that eventually allow even 3 or 4 modalities to play out there to achieve optimal treatment for patients. Okay. That's interesting. Thank you. The next question we have is from the line of Chen Zhang from Zohr Securities. Your line is now open. Hi. Thank you for giving me this opportunity. We have 2 small questions regarding to manufacture and commercialization. The first one is our understanding if our understanding is correct, we are building our own facilities for manufacture, but we expect the Jutobi and Xceva to be approved in 2021, 2022, which is very will be happen very soon. But is there a small gap, a time gap between our manufacturing facility to put into production and the product approval? So will that be ready for the launch of these 2 commercial stage products? So that's the question for manufacturing. The second one for our commercialization team. We understand that we're building our own sales team in China. Could you please share more details on what, for example, the team size, how much would how many people will be including in the sales team? And also the like the 1st year penetration target for hospitals, details about that. Thank you. Sure. Thank you for the questions. For the manufacturing question, the most I think the most faster way of transferring manufacturing is post approval and with manufacturing license change. And so that would be the approach that we've been taking. And we the first molecule that we pursue manufacturing of in Joshan will not be Treddy or rap cycling. So I think we have time to build out our facilities and get ready for subsequent launches. We have the tech transfer rights in many of our contracts. And so this will be going forward for the right profile of the molecule like sterile parenterals and more difficult molecules. So we believe that local manufacturing under our control is still the appropriate direction. For the second question about commercialization and size of organizations, the central marketing team, the central commercialization team, I think will top out around 75 or 80 people. For the sales force side for oncology, we expect a sales force in the neighborhood to 250 to 300 medical reps. With this, we believe we can cover 85% of the important hospitals in China. I would expect a similar size for Methicon, Methicon launch. And with eravacycline, that as well will not require a broad market sales team because it's a medicine that's used in very seriously ill patient, mostly in surgical intensive care that I've seen. So it's a much more concentrated population of doctors and hospitals and patients that we need to cover. So I wouldn't see any of the sales forces being any bigger than 200 to 300 medical reps. Ian, Neil, would you like to add to those answers? I think that's pretty much the details that we have guided externally. I think maybe just to add to a couple of points. For oncology, we think that we think we want to cover 80% of the breast cancer patients in China. And as you guys know, the first and second indications for XAVALVI is going to be TNBC first The second is likely to be HR positive HER2 negative breast cancer. So to cover this, we think a sales force of 200 to 250 people should be able to cover about 700 hospitals and that should be able to allow us to reach about 80% of the patients in China. And we will, of course, as we get additional indications into different cancer types, we will be expanding the team accordingly. And I think for nephakon, it's similar as well. I think AstraZeneca for roxadustat started with 200 person in their teams and very quickly build out to 500 plus. So I think a similar type of build is probably appropriate, although we think for IgA nephropathy, the end clients are markets is a little bit more concentrated than the dialysis segment in the hospitals, so we can potentially start out. And the speed of the ramp may not have to be as fast as Shizanika did with Roxadustat. So that's just to provide a little bit more color on the sales force side. Thanks a lot. That's very comprehensive. Thanks. Thank you. The next question we have is from the line of Collin Joo from CICC. Please proceed with your question. Hello. Thank you for taking my questions. Yossi Wang Joo from CICC. And I have 2 small questions. The first one is about Mexican. So what's your status now for Mexican China and what about our communication with CDE? Can we see the facilities and the FDA approval? And also, lucky to see that the IQA necessity is attracting more attention. And we can see many companies are entering into the areas also just like the molecular malakids as well as So what do you think about the competition with molecular? And the second question is about Trevali. So, clearly, we're going to announce the Phase III trial data in the cell line HR project for genetic breast cancer. And Carl, maybe someone are concerned about the efficacy in the subgroup which previously received the CDK inhibitor. So can you share any insights or opinions about this trial or the results? And also for the cell line monoclonal cancer, so this trial will also talk about the plans for this indication? Sure. Thanks for the questions. We'll start with the Nephcon question. So from the regulatory and Epicon was granted breakthrough therapy designation by CDE, which does make it eligible for accelerated cannopidastole approval. We will have our first Chinese data in the first half of next year, And we think that is the data that we want to build our MD Aon. Currently, the data is all outside of China, so other than our PK data in Chinese patients. So our expectation is that China will want to see a proteinuria data, which is the readout that will happen next beginning of next year and in safety data. From the competition side, I think we've raised a lot of awareness and PALADUIS has raised a lot of awareness around this disease around the world and in particular in China, and people aren't interested. It's a complicated disease and complicated clinical path. Early phase clinical data needs to be confirmed in large randomized trials that take years to run. So I think that those agents are somewhat behind. I think the biology is fascinating on those 2 B cell modulators. Although there are a few other mechanisms and we think that B cells make IgA. And so that's an interesting direction for IgA nephropathy and we follow these assets closely. As Neil suggested in an earlier earlier question or earlier answer, we believe that IgA nephropathy will require multiple medicines. And so I think that medicines like an April antibody or April binder will likely be used in combination with other medicines. And we think that's that standard medicines combined with because it will be the front renter and the standard of care will be Nekakon. And so we expect much like cancer, this is a serious, life threatening chronic disease that has lots of disability that people want to push proteinuria dialysis variable levels and try to preserve as much kidney function as possible and this will require multiple agents. So I think it's just a good thing for the patients to have more agents. For the TRYLVIA question, rosacotuzumab, dodepakin, as I should call it, for that molecule, there's lots of questions around hormone receptor positive, protein negative, most of those based off of a small Phase II trial with difference in the response to seeing a difference in response duration between HER2 between CDK4six naive and CDK4six failure patients. I think we have to think about the time frame in which that trial was done. And actually, if we look at the duration data, the ratio response data for CDK4six failures is actually quite good. It's just this in CDK4six naive, it's even better. And so it's not that either of the data points are bad data points. They're just different times in the natural history of the patient. So if the patient has only failed hormonal therapy and hasn't seen CDK4six drugs or a lot earlier in the disease than patients who failed them serially, So there could be a 2 to 3 year difference in that type of patient. So I think the expectation is that when patients who have failed more agents, the survival benefit will be shorter. And so I think this is expected and DALYAB has publicly reaffirmed their confidence in this trial and we look forward to the results soon. Thank you. There are no further questions at this time. Presenters, you may continue. Sure. I think probably given the time limit, probably I got a last question from an email I'm going to ask is, investors start to see emerging new players to get into the top 2 ADC space. So trying to get a sense from the company that whether you're going to see any of the major threats coming from upcoming players in the space or any differentiations we'll be talking about here? Certainly. So TR It has a very high DAR between 7.58 where most of the other TRO2 ADCs are they have a different antibody. They have a stable linker. They have highly toxic toxins of different classes. Some are topyl inhibitors, but others are tubulin inhibitors and other mechanisms. So these are all new molecules. I think you're probably all aware that one of the molecules failed in Phase I just recently because of intolerable toxicity related to the LincolpiMoD combination. So I do believe that with any active blockbuster drug, there'll be lots of people who try to capitalize on the target and the approach. I think the biggest competitor today is Daiichi Sankyo and AZ with PS1062. And at this point, they're still behind substantially. So I like the position we're in. We fully expect there will be competition. The science will have to sort out. But we've had 2 big failures, one from Pfizer and now one from this Chinese company just recently, both in Phase I, both with stable linkers and very highly toxic toxins with lots of TRO2 related toxicity that's just not tolerable by patients. So I haven't seen anything that really copies sacrotuzumabrutifen today. So I think we're quite differentiated. Got it. Great. I think we're going to close to end of the call. I'm going to turn the call back to Cary for any closing remarks. Hey, just very quickly, thanks for all the questions. I'd like to thank you for joining us on the conference call today. We look forward to keeping everyone updated on our progress, and we look forward to demonstrating our business development acumen over the next several months. So thank you very much, and take care. Be careful. Thank you, Gary. Thank you, Ian. And thank you, the management team, for attending the call. And thank you, everyone, for joining this call. We're definitely looking forward to more milestone events happening to Everest. So thank you very much for dialing. Have a good day. Thank you. Thank you. Thank you. Ladies and gentlemen, this does conclude our conference call today. Thank you for participating. You may now disconnect.