Welcome to the BioArctic Q2 presentation for 2023. During the questions and answer session, participants are able to ask questions by dialing star five on their telephone keypad. Now, I will hand the conference over to the CEO, Gunilla Osswald, and CFO, Anders Martin-Löf. Please go ahead.
Good morning, and welcome to BioArctic's presentation for the 2Q of 2023. I'm Gunilla Osswald, and I'm the CEO of BioArctic, and I will share today's presentation with our CFO, Anders Martin-Löf. I think it's very exciting times for BioArctic, with Leqembi now granted full approval by the FDA last week, and with CMS announcing a broader reimbursement. It's a beginning of a new era, and BioArctic is behind this true breakthrough in the treatment of Alzheimer's disease. We can now help a large number of patients and their families, and I think that is extremely gratifying. Of course, I will talk more about Leqembi here today. Next slide, please. BioArctic is listed at Nasdaq Stockholm Large Cap since January this year, and this is our disclaimer. Next slide, please. Leqembi is the trade name for lecanemab, and that was approved last week in the U.S.
That means that Leqembi is the world's first fully approved disease-modifying treatment for Alzheimer's disease. On the ninth of June, the FDA advisory committee had a meeting where they, at the end, voted unanimously, confirming the clinical benefit of Leqembi. The advisory committee reviewed the efficacy data, the biomarker data, and the quality of life data, as well as having a thorough review on the safety data. The efficacy data are consistent across scales and across items in the Phase 3 CLARITY AD study. It showed a reduction of the progression of the disease and slowing of cognitive as well as functional decline by 26%-37%. The safety data was discussed in detail, in particular with regard to the side effect ARIA, which is a class-related side effect.
Sharon Cohen, she presented health-related quality of life data from both family and patient perspective, with 38%-56% less impairment after 18 months treatment of lecanemab. This underlines the ability of lecanemab to help patients to function independently for a longer time, that could mean, for example, that patients are being able to dress, take care of family finances, feed themselves, and participate in hobbies and activities of interest. The clinically meaningful effect of Leqembi was emphasized in this early and broad patient population that was included in the Phase 3 trial. On the sixth of July, FDA granted Eisai a traditional approval for Leqembi for the treatment of Alzheimer's disease.
This means that the approval, previous approval, which was an accelerated approval, which was based on biomarker data from the Phase 2b trial, was now converted into a full approval based on the confirmatory Phase 3 Clarity AD study, verifying the clinical efficacy of Leqembi. We compare the label from the accelerated approval to the full approval label, the main difference is the inclusion of a boxed warning for monoclonal antibodies against aggregated forms of amyloid beta, including Leqembi. The warning specifically relates to the side effect area and the increased risk for homozygous of APOE4 allele to create a foundation for patient and physician to have a good dialogue regarding the risk-benefit. It's quite common that new kind of treatments receive boxed warnings.
If we think about those that received an approval last year for first-in-class treatments by the FDA, more than 40% of them had a box warning. I think this is very good, and I think it supports a responsible and informed introduction of Leqembi into the U.S. market. Teresa Buracchio, who is the acting director of the Office of Neuroscience in the FDA's CDER, she said in the press release last week, "Today's action is the first verification that a drug is targeting the underlying disease process of Alzheimer's disease, have shown clinical benefit in this devastating disease. This confirmatory study verified that it is a safe and effective treatment for patients with Alzheimer's disease." On the same day, CMS announced that based on the full FDA approval, Medicare will now provide a broad insurance coverage of Leqembi.
That is for all patients that are eligible according to the FDA-approved label, provided that a real-world evidence is collected in an available, easy-to-use patient registry. The items to be registered are those that normally would be entered into medical records. I think the burden of data entry is expected to be small. I think it's extremely gratifying that Leqembi, which is originating from BioArctic with Professor Lars Lannfelt as the inventor, now can be helping many patients and their loved ones. Next slide, please. lecanemab has the potential to become the first disease-modifying treatment for Alzheimer's disease and to receive a full approval on a global level in all three major continents. It has already happened in the U.S., with the FDA providing Eisai full approval of Leqembi last week.
Reimbursement is, of course, also important, and the Veterans Health Administration decided earlier this year to provide co- coverage for veterans with Alzheimer's disease. Now Medicare, which is the major insurance part in the U.S., is also covering Leqembi on a broad level. Eisai is also exploring less frequent maintenance dosing and evaluating a subcutaneous administration by an auto injector, and they plan to file first quarter of next year in the U.S. Leqembi is now also in a regulatory review process for a full approval in many other parts of the world. The next one to think about is Japan, where lecanemab has undergone a pre-review process of data during last year.
Eisai submitted a full application in the beginning of this year to the Japanese authorities, the application has then also been granted priority review, Eisai is expecting a response in September this year. In Europe, Eisai submitted the MAA ninth of January, that was based on both Phase 2b and Phase 3 data. The applications was accepted 26th of January, it's now following a standard review process, the response is expected first quarter next year. In China, Eisai has initiated the application process in December last year, the priority review designation was provided in February, we are awaiting response in China by the first quarter of next year. Regulatory process is also ongoing in other parts of the world, for example, in Canada, Great Britain, and South Korea.
I want to compliment our partner, Eisai, for their dedication and hard work with the clinical studies and the regulatory processes in such a timely way. I think this is very important since every day matters for the patients. Next slide, please. If we reflect a little bit on the population of patients with early Alzheimer's disease, it is enormous. Eisai has guided and estimated that the global prevalence for future early Alzheimer's disease could include about 240 million people by 2032, of which then about 75 million of those people are in Americas, EMEA, and Japan. Of course, all the patients will not be treated by disease-modifying therapies.
The patients first, of course, need to come to healthcare, and they need to be diagnosed with mild cognitive impairment or mild Alzheimer's disease, with confirmed amyloid beta pathology, in order to be eligible for a disease-modifying treatment. Even if only a proportion of all patients with early Alzheimer's disease will be treated, it's still a huge opportunity. More and more patients could potentially be treated if we work on some of the challenges. Eisai has estimated that approximately 3 million patients will be treated with disease-modifying therapies by 2032, which is a lot of patients. There are several opportunities that could create, could increase access, and some of them are listed to the right. We could, for example, work on increasing patient awareness, especially on the mild cognitive impairment part, which is not diagnosed so well yet.
Now when there is a treatment, it's more focused on that as well. Also, earlier signs of the disease and working on less stigma for Alzheimer's disease patients. Education of primary care on both diagnosis and biomarkers and treatment options, so they can refer the patients to specialists. Access to specialist care is, of course, also important to try to facilitate, and it's important role for the memory clinics to make sure that the right patients get the right treatment. Parts that are linked to that is, of course, confirming pathology with CSF or amyloid PET, following treatment with MRI, and ensuring access to infusions and so forth. Improved diagnostics is an important part, and it's really reassuring to see how well the blood-based biomarkers are progressing in parallel with the treatment options.
The subcutaneous formulation is another important opportunity to increase access and make the administration more convenient by getting the treatment and also make it possible to get the treatment easier and at home. We are working with our partners on all these aspects for the benefit of the patients. Of course, we would like as many patients as possible that could benefit from lecanemab to be able to get access to the treatment. Eisai has forecasted that 10,000 patients will be treated by Leqembi at the end of 1st quarter next year. If we think about what that means with regard to the U.S. Alzheimer's population of approximately 6.7 million, that's 0.15% of the Alzheimer's population in the U.S.
I think that we can conclude that there is substantial room for growth, and that Leqembi can be a treatment of major importance. Next slide, please. We are very happy about our long-standing and successful partnership with Eisai, all the way back since 2005, and we have two license deals and several research collaborations with Eisai. Far, we have received EUR 35 million in regulatory milestones for, from Eisai this year, and we have another EUR 101 million still remaining in milestones if lecanemab continues to progress well. That is mainly linked to regulatory approvals and to sales and marketing milestones. The next potential milestone would be related to regulatory approvals in Japan and in Europe.
BioArctic is also entitled to royalties of high single-digit % for the first 10 years following launch, and mid-single-digit % for the following five years on a country-by-country basis. I think this is of substantial value for BioArctic, and it could be a blockbuster potential of lecanemab, which means that we could see revenues of more than $1 billion per year without having any cost for clinical, the clinical program in Alzheimer's disease, and very limited cost for commercialization. BioArctic has also retained rights to other indications and to market in the Nordics, and we are now preparing for that and very much looking forward to doing that together with Eisai. Next slide, please. lecanemab is, of course, a key project for BioArctic, but I would like to emphasize that BioArctic is more than lecanemab.
Alzheimer's disease is our largest area, for Leqembi, we have one more additional large phase III trial, which is ongoing in even earlier phases of Alzheimer's disease, so even before the symptoms appear. Even if it's the first step with the disease-modifying treatments, which will be successful, there is still a large medical need for more treatment options and for combination of therapies. Therefore, it's important that BioArctic and many others continue research in this area. We have four early disease-modifying programs, including two of those that are combined with our BrainTransporter technology. We have also two of the four projects that are targeting truncated forms, such as PyroGlu- Aβ, and that one of them is combined with our BrainTransporter technology.
Based on BioArctic's positive Phase 3 results, I think that the probability of success has increased in our other programs with similar approach when we are targeting the toxic, soluble, aggregated forms of proteins that we call oligomers or protofibrils. In Alzheimer's disease, the proteins is amyloid beta. In Parkinson's disease, the protein is alpha-synuclein. In ALS, the protein is TDP-43. I also want to mention that I think that our ALS program, targeting TDP-43, is progressing very well and quickly. That is thanks to our technology platform and our vast experience from Alzheimer's disease and Parkinson's disease project. We are also working on another rare disease, Gaucher disease, with an enzyme replacement therapy, with the aim of also being able to target the CNS symptoms of Gaucher disease. This is an unmet medical need today. This is a rare disease indication.
Finally, our BrainTransporter technology, which I think is a very exciting part, is progressing really well. It's now in preclinical development phase. The BrainTransporter technology has now been included in projects in all our disease areas. In the future, if it continues to progress well, our BrainTransporter technology could also be applied to other companies, antibodies, or proteins on non-exclusive license basis. As I said, I think Leqembi is, of course, very important for BioArctic, I want you to remember that BioArctic is more than Leqembi, our portfolio is progressing really well. Next slide, please. By that, we come to the financial summary, I will hand over to our CFO, Anders Martin-Löf. Next slide, please.
Thank you, Gunilla. If you start looking at the left-hand side on the revenues, graph, you see that our net revenues for the quarter were SEK 3 million. For the first half of the year, our revenues were SEK 397 million. That is explained by the three milestones that we received in the first quarter, totaling EUR 35 million. As Gunilla pointed out, we are entitled to one further milestone that could occur later this year if we do see approval in Japan. That is forecasted for September by Eisai. Over time, our revenues will become less lumpy as we now are receiving royalties after the launch of Leqembi. However, it will take some time before those revenues actually will become larger than the milestone payments.
Just as an example, Gunilla mentioned that Eisai are forecasting to have 10,000 patients on Leqembi at the end of the first quarter of 2024. If we would have 10,000 patients on average during a full quarter, that would generate in the ballpark of SEK 50 million for that quarter. You should not see that as a forecast for the first two quarters of next year, but that gives a hunch for when do we expect to see significant royalties that are at par with the milestone payments. If you then turn to the midsection, you see that their operating expenses increased from SEK 50 million - SEK 104 million in the second quarter. They also doubled for the full six-month period, going from SEK 98 million- SEK 200 million.
That is mostly driven by increasing personnel costs that increased from SEK 23 million - SEK 72 million in the second quarter. That is primarily driven by non-recurring costs for stock options and related social security contributions, and also by a repurchase that was made from Gunilla Osswald. If you take away that, the increase of SEK 48 million in personnel costs during the quarter, of the SEK 48 million, roughly SEK 8 million were driven by increasing staff. The rest were these non-recurring costs. Over the longer term, our costs will continue to increase due to the buildup of our commercial organization and certainly when we progress our project portfolio further, but they will not increase in the second half of the year.
We still reiterate our full year guidance of SEK 330 million-SEK 380 million of operating expenses. You see that the costs are expected to decrease during the second half of the year compared with the first half. If you then look at the right-hand side, you see that the operating loss was SEK 101 million for the second quarter. We made a profit of SEK 200 million for the first half of the year. If you then combine that with our full year guidance, you understand that we should have the possibility to be profitable for 2023, even without an expected approval in Japan. We turn to slide 10. Starting with the mid graph, you see our cash flow.
That was SEK -64 million in the second quarter, but all in all, for the full six-month period, it was a positive SEK 235 million, and that's roughly SEK 35 million better than the operating profit. That is mostly due to the fact that the costs that are recorded in the operating profits are, to some extent, non-cash costs, especially the stock option costs. If you look at the left-hand side, you see that we started the year with SEK 805 million in cash, and we're currently at SEK 1,042 million. We'll see where we end up towards the end of the year. If we get an approval in Japan, I believe that we will be above SEK 1 billion at the end of the year. On the right-hand side, you see the net result.
We made a loss of SEK 102 million for the second quarter and a profit of SEK 192 million for the combined period, January to June. The decrease from the operating profits is mainly explained by a tax recorded of SEK 20 million in the first quarter of this year. That concludes the financial section, I hand back to Gunilla.
Thank you so much, Anders. Now we come to the upcoming news flow and closing remarks. Next slide, cells. More data on lecanemab will be presented at coming Alzheimer's disease congresses, and the next one is next week in Amsterdam, and there will be several presentations of lecanemab. You saw more details of that in the press release that was issued this morning. The next congress after that is CTAD in Boston in October, where there also will be several presentations on lecanemab. The regulatory process continues, and Eisai expects response from the regulatory authorities in Japan in September, and in Europe and China, responses during first quarter of 2024. We will, of course, provide more information on other parts of the world when that is relevant.
I think that we can conclude that we had a fantastic first half of this year, and that we have a very exciting time ahead of us. Next slide, please. I would like to conclude by saying that BioArctic's aim is, through world-leading innovative research, to create drugs that improve the lives of patients with neurodegenerative diseases. We can conclude that Leqembi, which is originating from BioArctic, is now the world's first and only fully approved disease-modifying treatment for Alzheimer's disease, and it's leading a paradigm shift in the treatment of Alzheimer's disease. I think that BioArctic is an innovative and dynamic and very exciting company with a huge potential. By that, I say thank you for your attention, and we're happy to take some questions.
Operator, are there any questions?
If you wish to ask a question, please dial star five on your telephone keypad to enter the queue. If you wish to withdraw your question, please dial star five again on your telephone keypad. The next question comes from Fredrik Thor from Redeye. Please go ahead.
Hello, and thank you. My question was a bit... You mentioned this a bit maybe, but do you have an update on how royalty revenues will be recognized? Will it be the same quarter as the sales, or will it be with a delay?
I should answer that. Yes, we will record the royalties based on the actual sales of each quarter going forward. Eisai will report the sales, and then we will issue our reports after Eisai. You would see the sales figures for Leqembi first in Eisai reports, and then you can basically deduct our royalties from that.
Perfect. My next question was a bit about how Leqembi is purchased. You mentioned a bit here that the 10,000 patients you mentioned, a reduction for that would be that it would be recognized, the purchase would be on a monthly or a quarterly basis. I was just wondering if you can elaborate a bit on how kind of the pharmacies or how they are purchasing Leqembi. Is it, you know, in bulk or continuously throughout the treatment?
Well, they probably buy some stock, but not much. They're basically buying continuously. For your modeling, I would just assume that they're buying continuously.
Thank you. Maybe a final question was a bit on BAN0805. Is there any progress on the partnering discussions, for example? Is it reasonable to see any progress this year?
I think, with regard to our Parkinson program, we are preparing for Phase 2. We're doing a lot of work, and we are, reviewing to see which is the best way forward, if that is to drive it ourselves, into Phase 2 or if it is with a partner. We will come back with more information, later this year, if we have more information then.
Okay. Thank you. That's all for me.
Thank you, Fredrik.
The next question comes from Patrik Ling from DNB. Please go ahead.
Hi, good morning. Just a few questions from me, please. First, I mean, we saw some changes in Eisai when it comes to the head of Alzheimer's disease. Maybe you can give us some clarity with that, if that have any implication on for the further development of Leqembi, or do you have any more color on why that happened now, 1 week after the approval?
I think, first of all, I would like to say that we have a great collaboration with Eisai and with many different people at Eisai. Ivan Cheung was the head of Alzheimer's disease and the, in the U.S., and it was just announced that he will retire and be replaced by the son of the CEO, and this is a family-owned company. I think by putting in the son, it shows how important they think this is with Alzheimer's disease. Of course, I personally will miss Ivan, but there are many other very important people in Eisai doing a tremendous piece of work. I'm very confident that Eisai will drive this program forward in the best possible way. I'm sad, but I'm not worried, if I put it like that.
Okay, great. Could I also ask when it comes to the other potential indications for lecanemab, the ones that Eisai do not have any rights to? Maybe you can update us a little bit what is happening there on your side first, and whether you're having any discussions with Eisai, if they are interested in actually taking the full rights to Leqembi in one way or the other.
Excellent question. Thank you, Patrik. Just as you said, BioArctic still owns other indications, and we have been looking into several different indications. What we have communicated so far is, for example, Down syndrome with dementia. Now we're looking into a couple of other indications that might be even more interesting and important. We are doing some ex vivo work to see that lecanemab is the right treatment for that. Of course, we will be discussing this with Eisai. I think the first very important part was to see that Alzheimer's disease, which is a huge indication, that that's not disturbed in any way. That was the first step. Of course, we are working on the other indications, and we'll start to discuss that, of course, with Eisai first.
Otherwise, there are other opportunities with other partners in the future, potentially. We have to be patient and see, but now we are really happy about the Alzheimer's disease, to start with.
Great. My last question, when it comes to your own sales and marketing in the Nordic regions, I mean, you always say that you will sell and market the product in collaboration with the Eisai. Maybe you can give us some clarity on exactly how that collaboration will work in the Nordic, what you will be responsible for, what Eisai will be responsible for, et cetera.
We have a great collaboration with Eisai, both in Japan and in the U.S., and now we're also building a great collaboration with our European organization, where, and of course, we will benefit a lot from all the great work on the global level, that commercialization aspects for lecanemab and Leqembi is being done. A lot of interactions on global level, a lot of interaction on European level, and now we are working also very close with the Nordic organization. Discussions are ongoing exactly who will be doing what and how, and we will come back to that when we can. What I can say is that, I mean, we are building our organization stepwise.
We have started with the strategic positions, and the more field-based key account managers and so forth, they will be later on, closer to a hopeful registration. Now it's really, I mean, building all the strategic positions, and we have built positions for the Swedish market. We have also a couple of people now in Denmark. We have a couple of people in Finland, and we have just recruited our first person in Norway, and we have then also built BioArctic as subsidiaries, is that the right word, in the Nordic countries.
We're taking this stepwise in order, but there is a lot to do in order to help healthcare and society to be ready because this is a new kind of treatment, a disease-modifying treatment that does not exist yet on the market, and it's for a new kind of population. We go earlier than normal, ordinary diagnosis today. We also go into the mild cognitive impairment, which is a new kind of diagnosis, and then it also requires some infrastructure. There is a lot of work to prepare that we have started to work together with Eisai and work with society in order to make a really successful launch in Europe, which is our aim, of course.
Great. Just a follow-up. Could you say anything about how the financials in the Nordic region will work?
The only thing I can say is that it's not royalty-based. I mean, it's based on that we will be doing the commercialization together. Exact details, we have to come back to later.
Okay, great. Thank you.
Thank you.
Talk to me.
The next question comes from Viktor Sundberg from Nordea. Please go ahead.
Hi, and thank you for taking my questions. I have three, if I may. I had one on the BrainTransporter technology. I noted here in the quarter that Biogen exercises option to develop and commercialize the Denali's Antibody Transport Vehicle program based on the previous collaboration that was formed in 2020.
Based on the fact that your technology, as far as I can see, is also based on latching onto the transferrin receptor, I wondered if you could perhaps map your program on top of Denali's progress, if you think that you're also on the same development stage as the Denali program, or what is left before we can see a similar collaboration, perhaps with you and Eisai or other players that are developing amyloid beta antibodies, or if you need to show some more proof of concept data before that could be materialized. I'm just trying to understand where in the timeline you are with your brain transport technology. Another question I had was also on the timeline for CMS covering more than one PET scan in conjunction with amyloid beta antibodies. Still, to me at least, this remains a bit unclear.
I don't know if you have got any more indication when a more generous reimbursement policy for PET scans could be implemented. The final question I had was also if you plan to provide financial guidance on net revenues, perhaps next year, as you probably record more substantial royalty income going forward, as you mentioned today here. Thank you.
Thank you so much for great questions, Viktor. I'll start with the first two and then hand over to Anders for the third. The first one was with regard to BrainTransporter, and in that area, it's a very, very hot area, of course, to get antibodies and proteins coming better into the brain. There are two companies who are in the lead here, when you think about transferrin receptor facilitation, and that is Denali, as you mentioned, it is also Roche. We have recruited people both from Roche in Basel and from Denali in San Francisco. They are working on they and many others, we are investing in this area, and we think that we have something which is really competitive versus those who are in the league right now.
Of course, Denali and Roche are ahead, but we think that we, the same way as in the amyloid beta field, we have something which is coming a bit later, but that we think is hopefully better. The timeline here is that we are in preclinical phase, and we have now combined it with the programs in all our different disease areas. I think it's fair to say that it's our Alzheimer's programs who are the most advanced among those. We will come back with more information when we have that as possibilities. Of course, I mean, this has huge opportunities to be combined with many different programs, and I'm very excited about the future here. Sorry, I can't give you any more exact details here.
With CMS and the PET scan reimbursement, I wish I knew more. What I can say is I know that there is a lot of pressure on CMS and request that they should start to reimburse the amyloid PET scans on a broader base, since they are one of the important ways to diagnose the patients and show that they have an amyloid pathology. There are other ways, for example, with CSF sampling and so forth. So far, we can just hope that they soon will do the reimbursement on a broader way there as well. For the financial guidance, I hand over to Anders.
Right. Now, of course, it will be very hard for us to guide on the revenues for the royalties without proper guidance from Eisai, and we don't know when they will start guiding on Leqembi revenues. For us right now, we can't really tell when we will be able to guide on our royalty revenues. Okay, thank you very much. Thanks.
Thank you, Viktor.
The next question comes from Erik Hultgård from Carnegie. Please go ahead.
Hi there, congratulations to the full approval and the broader coverage from CMS. I have one question more to add, and it's related to the market access in Europe. What do you expect in the Nordics in terms of reimbursement, pricing and reimbursement, and also in the top five markets? What timelines should we think about as we approach the European approval? Thank you.
Excellent question, Erik, thank you so much. I think that, as you know, market access in Europe is really country by country, and it's very different among different countries. Without any specifics to lecanemab, what normally happens is that countries like Germany and Austria are very early on with regard to the launch, whereas other countries take different long time. Even though we hope the Nordics should be as quickly as possible, it will be a bit later, of course, than Germany. I think we will just have to take it step by step, and it's really important to have the dialogues with the with regard to the reimbursement parts. I think it will be stepwise, different country by country in Europe as normal.
We'll see. We'll come back with more information when we have it.
It's fair to assume, like the standard six, 12 months, in sort of the major markets.
Yeah, I don't think we have.
Quicker.
Yeah. No, I don't think we have any information about that we should be anything else than.
Okay.
Standard times.
All right.
Well, we'll see. I think what no one knows is U.K. and Great Britain with their new process and how that will work with regard to regulatory, we know NICE takes time. If you think that U.K. is also one of your five big countries.
Maybe I can sneak in one on for Anders as well, on the sort of marketing infrastructure in the Nordics, and how you think about facing costs. When do you anticipate to sort of add sales reps and the bulk of cost? Is it post-European approval, post-reimbursement, or at what time point?
If I'm to guess today, we would like to add our key account managers ahead of the launch, but not by much. We will know better during next year when we start to see what's happening on the reimbursement side, but when we can actually launch the product. Right now, it's hard to tell. I don't think that we will add more sales reps in the first half of next year. Some time point after that, but hard to tell exactly when.
Definitely post-approval for the key account managers.
Definitely, yes.
Yeah. More strategic positions before that.
All right. Thank you so much.
As a reminder, if you wish to ask a question, please dial star five on your telephone keypad.
There doesn't seem to be any more questions in queue, by telephone, Gunilla and Anders, but we have a few questions online that are posted. Maybe I can just sneak one of those in because then I saw Joseph is coming on. There are two questions regarding the subcutaneous development by Eisai, wondering a bit about what kind of level of data is required for such a submission. Gunilla, is that anything you can comment on?
Yeah, I think that's a great question. Of course, patients, for patients, we really would like also to be able to provide a subcutaneous administration. Eisai is also working on this together with an auto-injector to make it very convenient for the patients. What has been done is a couple of Phase 1 studies to show the bioavailability level, now it's being evaluated in the open-label extension part of the Clarity AD study. In that extension, Eisai has also informed that there are both patients that has been coming from the Clarity AD study, who have been on IV infusion previously with lecanemab, and those who also have been on placebo, so they are kind of newcomers.
There is also some de novo patients in that part, which will be included in the evaluation of the subcutaneous formulation. That is expected to be what is needed for a sub-Q filing for the U.S., which Eisai have guided that is expected to happen the first quarter of next year. That was the answer to the sub-Q.
Yeah. Thank you. I'm not sure if we're going to go to the question queue now with Joseph Hedden, maybe, operator?
The next question comes from Joseph Hedden, from Rx Securities. Please go ahead.
Hi there. Thank you for taking my questions. Congratulations on the full approval. I just wanted to ask a few, perhaps the first one around the online portal that Eisai have been talking about for the Medicare Coverage with Evidence Development. You know, Eisai have said that it's a, it's a relatively easy-to-use portal and that it's relatively standard patient information, takes five minutes. I just wondered whether you'd seen it and what your thoughts are on that.
Thank you so much, Joseph. Of course, everyone is eager to understand more details about this online portal that Medicare is providing. It's free to use, and it's said that it should be easy to use and with the same kind of information that you normally assemble anyway. That it should take between five and 10 minutes to do the recording. I, as the curious person, tried to log in, but I was not allowed in since I'm not a physician in the U.S. I don't know the details, really, more than what I just said.
Okay. Okay, then perhaps on, Eisai's got a target of 10,000 U.S. patients, it seems, by the end of their financial year, so March 2024. I was curious as to how did that fit with your after their notes, how did that fit with your internal forecast? What's that relative to your thinking?
Well it's really hard for us to make internal forecasts without thinking about Eisai's forecast. Let's say are very much in line with Eisai's forecast. I think it's important to note that 10,000 patients, as Gunilla pointed out, that's some 0.15% of the Alzheimer population. There is plenty of room to grow from there. There are question marks, how fast will it be to introduce this new product, since you do need the infrastructure for PET and MR and infusion centers. We think that will be sorted out. Longer term, the market will be huge, but for the first six months or so, it's really hard to estimate how quick the uptake would be.
It seems Eisai has made a fair assumption, and it's hard for us to make any better assumptions because they are the ones who are on the ground and have estimated this. They have mentioned that they have educated already 1,200 physicians that are ready to prescribe the drug, and that they have educated 700 infusion centers. That would probably mean that they can start prescribing right away. On the other hand, getting all these infusions going, performing all these MRIs and PET scans, is probably going to take some time. We'll see what happens, but our expectations are in line with Eisai's expectations, basically.
Okay. Okay, that makes sense. Thanks. Perhaps just one on subcutaneous lecanemab and the AAIC presentation. I noticed that one of those presentations is on some subcutaneous data. Could you tell us if that's from the previous Phase 1 study, or is this the first data emerging from the phase 3 open-label extension?
To manage expectations, I think it's fair to say we should expect mainly simulations and what this could mean with regard to efficacy and safety and so forth. I think that true data from the Phase 3 trials, open-label extension part, is expected later. It's, it's more from the first studies, the Phase 1 studies, and then some modeling that it should be expected.
Okay. Okay, great. Thank you very much, and congrats to you all again.
Thank you so much, Joseph.
So-
There are no more questions at this time, so I hand the conference back to the speakers for any closing comments.
Thank you, speaker. I note there is another question, though, online, which I think we should also mention, and that's a question, if I've understood this correctly, Gunilla. There's a talking about the expiration date of patents and patent life, but also the time it takes to develop a new drug. Maybe you can say something then about future plans for BioArctic when it comes to developing new drugs, how long will that take, and when will we have other BioArctic drugs on the market to sort of take the next step as a company?
Yeah. Now, of course, I mean, it's important to realize that the development of Leqembi has taken some time, but the most important was that it's successful. Of course, for the first projects, it takes a bit of time. We still have a good time for until patent expiry with the extension, which is up to 2032. I think it's also important to note that there is the regulatory data extension time that you also can think about and the market exclusivity time, which is 12 years in the U.S. and 10 years in Europe. That's one part of the question, as I understand it. The second part of the question is, in the future, what would we expect from different kind of treatments?
I think it really depends on the kind of treatment. For some treatments, I can think of ways of doing it faster. For other treatments, I could think about being combination therapies and so forth. It really needs to be taken project by project. Of course, with regard to our projects, we will ensure that we do the most efficient and timely drug development programs as possible for those programs. It has to be taken project by project.
Thank you. We have another question that just popped up here, too. Let me just read it. There are important differences between subcutaneous and IV administration. It may affect the distribution in the body, and so forth, also in CSF. Is there any indication that the subcutaneous will be better?
I think that's an excellent question. If we think about what has been presented previously, and we'll look forward to more presentation next week, but what has been presented previously is that the hypothesis is that it is the average concentration which really steers the efficacy. It is the Cmax, the maximum concentration, that it potentially is more linked to the side effects. If that holds true in the clinical setting, that would mean that we would expect a similar efficacy, but a lower frequency of side effects with regard to ARIA, for example, from the sub-Q treatment. I think it would be very, very interesting when we have the data, and we'll see if those hypotheses hold true in the clinical setting.
There are indications, definitely, on that it could be better, and definitely it's more convenient, and it will be more of a fixed dose to everyone instead of for IV infusion, it is depending on the body weight. Also, with the auto injector, I think that makes it very much more convenient for the patients or caregiver to provide this. What is being studied now is once a week dosing that is easily done, for example, at home. We have to stay tuned until we have the data, but definitely the hypothesis says that it could be better with regard to safety.
Thank you, Gunilla. Just another question came in. Can you comment something on the AHEAD 3-45 study?
Yeah, the AHEAD 3-45 study is another very exciting phase three program, which is ongoing around the world. It started in the U.S., but it's also in other parts of the world, and we are also hoping that it will come to Sweden soon. It's not fully recruited. It is being recruited more and more, and this is, as you know, more of a prophylactic study where you will start to give the treatment before you have any symptoms.
What you do in the screening phase is you find out that you have increased levels of amyloid in the brain. Depending on how much increased levels you have of amyloid in the brain, you get either then randomized or coming into the A3 part of the study with a slightly lower dose, or if you have more amyloid in the brain, you come into the A45 study, and then you get a slightly higher dose. This is a four-year treatment period, and it will be based on for the A45, a clinical outcome called the PACC5, and then biomarkers. We will come back with more information on this study also when we have more information to give, but that's definitely a very exciting study to follow as well.
Thank you, Gunilla. I can see no further questions in the question queue. Do you want to end with a few summarizing comments?
Yeah. No, thank you so much for many great questions and comments. I think that, as I said, we have had a fantastic start of this year, where we are now really changing the treatment for Alzheimer's disease based on lecanemab-Leqembi, which is originating from BioArctic. I think it's also transforming BioArctic to a new kind of company, where we will be looking forward to more stable income and with regard to royalties. I really look forward to when the royalties are higher than the milestones. You have to follow us and stay tuned, and thank you so much for today, and I wish you all a great summer.