Ladies and gentlemen, welcome to the SOBI presentation of the Q2 results. Through the call, all participants will be in listen-only mode, and afterward, there will be a question and answer session. I will now hand over to Guido Oelkers, CEO. Please go ahead.
Yes. Good afternoon, everybody. It's really a pleasure to have you here at our Q2 webcast. With this having said, I will be joined today by Henrik Stenqvist, our CFO, and Milan Zdravkovic, our Head of R&D. I think, forward-looking statement as per usual. Why don't we go right into the beef of the presentation. Basically, this is a difficult environment, and I understand that we are one of the first group of pharma companies presenting. I think, therefore, it may be worthwhile to understand what happened actually in this environment. I just want to refer to U.S. data that we just got recently a hold of. Basically, in the U.S., total prescription between the end of May and beginning of June are down 6%-12%. These are weekly data, so they're oscillating.
More important is that NRx are down 30%-40%. It's clear that telemedicine is also not as effective as the usual pharma model. When you look at our market so that we have achieved in this environment, I think they have to be seen in view of this. Half- year data are actually quite strong for us. We have 20% top-line growth, 20% EBITDA, adjusted EBITDA growth. We have healthy cash flows, and we have been able to make a significant contribution to fight against COVID and got two studies that we talk later on published. We completed the enrollment of two key studies, the 06 trial in MAS, sJIA, and the CIT trial, which is also not understood in this environment. We gain market share with Elocta and Alprolix.
I think this is something that we want to spend a little bit more time on because it needs to be understood, particularly when you look at our Q2 number. We have made substantial progress with our new launches despite the lack of face-to-face interaction, meaning Doptelet and Gamifant. We are building the future. We're able to transact the license agreement for the global license of SEL-212 from Selecta. Overall, actually, we felt it was an ambitious agenda, and I think we need to understand a little bit more what are behind the headline numbers that you have all seen. Next slide, please. These are the data, as they stand. I think important to note is, and the narrative has been partially given already. We have a 4% patient growth, give and take, for our hemophilia product portfolio quarter-on-quarter.
This, in this environment where not a lot of switches have happened. Dr. Leddi talks about 52% quarter on quarter growth. Gamifant, 27% quarter on quarter. Kineret, we maintain a very solid performance with 24%. With Synagis, because I saw a couple of comments, I think we just have to recognize that the season last year was unusually long, hence we had more significant sales in April, which we didn't have because the season this year ended earlier. We had a very successful season as we outlined in the Q1 report. There is nothing down with Synagis. In fact, we are very proud of what we have achieved. Next slide, please. Here you can see the quarter on quarter, let's say development, whether it's a half year development.
I think there are quite a bit of adjustments that have to be recognized when you look at it quarter on quarter. Partially they are driven by stocking effects. As you will see later, the consumption per patient in some countries in Europe in hemophilia has come down, for instance, and that basically has affected our results. It's worth mentioning that Q2 in 2019 was also strong. These effects are more smoothened when you look at it on a half-year basis. This is 17% growth at constant currency. At actual currency, it's actually 20% growth. Important to note is that the core business in the same period, the product business in immunology and hematology, has improved considerably faster. Next slide.
This is, I think, something that we try to explain now what actually happened between in Q2 to make the performance a little bit better understood. We had an adjustment of our inventory. Let's say that we reflect, we said give and take. In the example of our Florio service was one-third of our growth last quarter was driven by the stocking effect, that's around between 140-150 million SEK. That was a stocking effect. We had a negative effect from the patient consumption, this is something we didn't really have on the radar. I just saw market data, for instance, from France, that is consistent for the entire hemophilia business, where basically patients, because they didn't want to go to the physician office, they wanted to stretch, essentially, their factor and elective surgery did not happen in Q2.
As a consequence, we had a negative effect that outweighed our patient growth. We think that this negative effect is of a temporary nature, and we believe that this will correct itself during the second half of the year. You need to understand that at the same time, we have a 21% H1 versus previous year patient growth with Elocta and a 29% patient growth with Alprolix. I just want to give you some thoughts that we have become the number one prophylaxis company in Germany in Q2, and we have not lost any market share in hemophilia in France either. This gives you a little bit of a perspective that we do not have a competitive topic. We made significant progress. When you look at the quarterly results, it's not as visible.
On a half-year basis, I think there's a certain smoothening effect, but still, the consumption per patient is an effect, obviously, also on a half-year basis that we think will smoothen itself out during the second half. Next slide, please. For us, the partnering with Selecta, it was a fantastic move, let's say, because we get access to a very important product in chronic refractory gout. We think that with this pegylated uricase that is powered by the ImmTOR platform, essentially, it is a rapamycin platform that can be also used in gene therapy to mitigate the effects of immunogenicity. We think that we have a very unique product and there are around 160,000 patients, and we think that this product for sure could be useful in around 10% of those patients. Alone in the U.S., it's a very significant opportunity.
We got the global rights and we got a share in the company. On the whole, we think it's a very strategic transaction in the immunology sector that is on target with our strategy. Next slide, please. Summarizing this first part, we continue to make significant progress in hemophilia, even in this difficult environment. Strong progress with Doptelet, despite lack of face-to-face interaction. The Gamifant quarter-on-quarter strong patient growth. We'll show you some data later. Yes, there's been a price effect, and yes, there has been an effect from the lower rate of patients, but also over time, these effects will be washed out. Continued growth with Kineret, progress in R&D, as I pointed out, and portfolio expansion. Next slide. Now we go into the business review of hematology.
Here you see basically for both products on a half-year basis to show the progress that we have made. I think important just to note is the patient growth and that we basically are able to continue expanding our share, even though it's much more difficult in a Q2 environment to switch patients, but we were able to do so, and that basically gives us the confidence also for the rest of the year. Next slide, please. Here you can see the progress that we have made with Doptelet, actually quite substantial. We're using here, let's say, units as a proxy. That gives you a feeling that we are actually making great strides with this product. We're very optimistic with the product and very gratified that despite this difficult environment, we were able to complete the enrollment of the CIT trial.
The team at the door is doing a fantastic job. Very proud of them. Next slide, please. We basically want to talk about immunology. Here you have to just notice the seasonal effect of Synagis and also the effect that we had such a fantastic end of the season in Q1, but it ended earlier. Hence, the Q2 comparison for Synagis is really not relevant. Let's say with Gamifant, we are now making some progress and maybe next slide. Here you can see basically the progress on a patient base. Basically when you would index this, the absolute patient growth in Q2 2020 versus Q1 2020 in comparison to the progress we have made one year ago is around 50% higher. It's a significant uplift of patient population.
We wish it could be faster, but you have to acknowledge that this is a significant progress, and the economics actually are more influenced by the price reduction that we established and by the lower consumption per patient because of the lower weight. As we're expanding the indication, we also think that we will continuously grow the product, and the product is on a good track. Next slide, please. Kineret is continuing to make good progress, as you can see here. We think that this is a product that has significantly more potential, but it's a crowded environment. It has shown us some positive effects even in a COVID-related environment. Just want to show you one slide and then before I hand over to Milan. Next slide, please.
Here you can see one of the studies that was just recently launched, published in May this year in severe forms of COVID. You see a beautiful separation of the Kaplan-Meier curve and an improvement of survival. Basically, whilst we can always argue that there are limitations to some of those studies, but we were very happy, and this confirmed our hypothesis that anakinra can have a significant role in this area of hyperinflammation. Basically many authorities have now a positive to a neutral view, whilst other compounds have been dismissed in the treatment regime. We have currently 2,500 patients in different trials ongoing. Some of them have the grade of phase III. We are looking at it quite optimistically moving in the future.
I think this is a good time now to hand over to Milan, and maybe, Milan, you can share your view on Kineret and maybe some of the data that we are generating.
Yes. Thank you very much, Guido. Please turn to slide 18. On this slide, we're showing some additional data to the data that Guido just showed. Another retrospective cohort study. This one was performed in Italy. This was from a group of patients that had a COVID-19 infection. They had acute respiratory distress syndrome, and they also had hyperinflammation. What we're seeing here in the patients with 29 that received higher dose anakinra in comparison to the historical control of 16 patients. First of all, anakinra reduced inflammation. It also showed improvement in respiratory function. Also, as Guido mentioned from the previous study, also a survival benefit. When we add up the data that has been accrued until now with anakinra, we think that these continue to support a potential benefit of anakinra in this patient population.
Of course, on the strength of that, we will continue to support research into this area. We will also evaluate when there may be sufficient data, also from randomized control trials, whether we can engage into a dialogue with regulatory authorities around the potential benefits of anakinra here. If you can move to slide 19, please. As Guido already mentioned, we have announced a partnership with Selecta around treatment of patients with refractory gout. Gout is an inflammatory disease that is essentially caused by elevated levels of uric acid, that subsequently leads to deposition of UA crystals. This can occur anywhere in the body, but most frequently it's seen in the joints. If sufficient crystals accumulate, these can cause tophi that may cause pain and restricted mobility.
As shown on the right-hand side of this slide, complications of chronic gout includes joint deformities with potential disability, but these crystals may also form in the kidneys, and here they may cause obstruction and/or infection. Refractory gout, which is the potential we're discussing here with SEL-212, are patients that are not controlled on conventional therapies. I will share a little bit more of the data on the next slide, which would then be slide 20. It turns out that humans do not have an enzyme that can break down uric acid. Whenever you give the recombinant enzyme, this will elicit a very strong immune response in humans. This not only causes a safety concern with infusion-related reactions, but also blunts the efficacy of the enzyme that is being infused.
The beauty of SEL-212, as Guido mentioned, is that this is a combination of the uricase enzyme and also rapamycin nanoparticles. These rapamycin nanoparticles, when given together with uricase enzyme, causes tolerance induction. This is what we're illustrating on this slide, where we see 66% of evaluable patients from a phase II study responding with serum uric acid levels less than six. Not only that, but also a very significant reduction in serious infusion reactions if the ImmTOR or the rapamycin nanoparticles are added to the combination. If I can have the next slide, please, which would then be slide 21.
There is a phase II study ongoing comparing 212 to pegloticase. The study is now fully enrolled and has some early data that suggests a lower withdrawal rate in the 212 arm versus pegloticase, which further supports the potential differentiation of the 212 molecule. The phase III program that I'm showing on the right-hand side here has been agreed with the FDA and consists of two pivotal trials that are planned to start later this year. If you can move to the next slide, which would be slide 22. This slide illustrates how we continue to build the R&D pipeline around our true core areas being hematology and immunology. Just to give you some updates since the last time we showed this slide, we have added 212 in phase II, expect to start phase III later this year.
As Guido mentioned, we completed the enrollment in the chemotherapy-induced thrombocytopenia trial with avatrombopag, and we expect results in Q4 this year. We got approval of FMF in Europe with anakinra. We very recently submitted the file in the U.S. for anakinra and DIRA. The file is under validation. We plan to add additional sites in the U.S. for the COVID-19 study in August to increase enrollment, and we also expect to initiate the phase II study with emapalumab in graft failure somewhere around year-end. With that, I would like to hand over to Henrik for the financial results.
Thank you, Milan. Good afternoon, everyone. Let's move to next slide and look at the financial summary for the quarter and the first half of the year. The revenues for Q2 amounted to SEK 3 billion 70 million. That corresponded to a decline of 3% and 4% at CER. In Q2, as we heard, we had to pay back for some of the favorable impacts that we reported in Q1 now in the form of destocking and other negative factors such as reduced consumption impacting from COVID-19. It's actually also relevant to reflect over the half year situation where we see a growth of 20% and/or 17% at CER. As we move on from revenue, we increased our gross margin to 78% in Q2 compared to 76% in 2019.
We continue to trend positively due to various favorable product mix, also including the diminishing share of the non-core specialty care business. We expect to see an accelerated decline in specialty care in H2 as a result of discontinuing products. The COVID-19 situation with lockdowns across most markets led to a lower activity level and a lower spend in Q2. Operating expenses in Q2 of SEK 1,344 million were in fact SEK 75 million lower than in Q1. As a result, adjusted EBITDA reached SEK 1,018 million for the quarter, corresponding to a margin of 33%. We hold the margin well because this margin reflects the seasonal weakness of Q2 relative to Q1. As we can see, the margin year-to-date of 41% is in line with the same period, 2019. Looking now a bit into cash flow and debt.
Despite the relative seasonal weakness, in Q2 that I just mentioned, we have an extraordinary operating cash flow in the quarter. This is mainly the result of a reduction in working capital following the collection of receivables from the high sales levels that we reported in Q1. As a consequence, net debt was reduced to SEK 11.8 billion from SEK 14.2 billion in Q1. If we switch to next slide. This illustrates the net debt development over recent quarters, and it's evident that we continue to rapidly de-lever the company, having levered up in 2019 to finance the acquisitions of Synagis, Gamifant and Dova. From the peak in Q4 2019 of SEK 15.4 billion, we have delevered now to SEK 11.8 billion in just six months.
This is, of course, very satisfactory, but we should also consider that Q3 and Q4 are expected to be a little less prominent in terms of cash generation due to the seasonality and the need to expand working capital, mainly because of the Silexys integration. The net debt of SEK 11.8 billion corresponds to a leverage which is now down 1.02 times EBITDA on a pro forma basis, which is, of course, very comfortable. We maintain available liquidity of more than SEK 7 billion despite maturities occurring during this quarter, and this position of financial strength, of course, provides us with opportunities going forward. With that, thank you, and back to you, Guido.
Thank you, Henrik. Maybe we go then to the summary. Next slide, please. Basically, when you look at it, we are making progress in a number of areas. With Florio, our digital platform, we have made significant progress, more than doubled our patients in Q2 versus what we had. The project is on a good way, and it's starting to become meaningful to a larger group of patients. We have avatrombopag with the CIT trial we talked about. ITP currently under review in Europe. We are ready for launch in CLD and waiting now for the right environment to launch a product in Europe. With regard to anakinra and immunology, the broadening the foundation, you have seen the data on anakinra, emapalumab, making at least on a quarter-to-quarter basis, on a patient basis, nice progress.
With SEL-212, we think that we have a very meaningful addition to our immunology franchise and synergies we have talked about. I think it's also important to note that now with portfolio, we further expand the company also geographically. We talked about an expansion into China last time, last , I think it's in Q1 and now we have set up a company in Japan as well. We think that particularly our immunology franchise would be very relevant for those countries. Next slide. When you basically look at the results, yes, there are some adjustments in Q2, but we are convinced that we see very strong signals from the market, from patients for all our products. For our core products, we are really not losing anything. We are gaining share, which is very useful.
That makes us, even in this very uncertain environment, confident to confirm our current guidance and let's say, that we can continue growing double-digit, our two core business areas. Core business grows well above 20%, 22% in constant currency. We think that we are on a good wave and the same applies for earnings. Our EBITDA guidance also remains unchanged. We think that we want to continue building the business. See at the example of Doptelet, we have seen that there have been some question marks around the Doptelet performance. The percentage of 52% quarter-on-quarter is without the milestone. This is pure operating business. Around SEK 100 million in Q2 and around SEK 65 million, Sten, in Q1. In addition, we had SEK 87 million of a milestone payment for China. That's really where we stand. We are feeling quite good about performance.
Maybe it's a good time now to invite questions as they may arise. Yeah, maybe we go to the question and answer session and other operator can help us.
Thank you. If you do wish to ask a question, please press zero one on your telephone keypad. If you wish to withdraw your question, you may do so by pressing zero two to cancel. There will be a brief pause while question have been registered. Our first question is from Eun Yang Jefferies. The floor is yours.
Thank you very much. I have a couple of quick questions on the clinical data timeline, and then one financial question. On CIT, I think previously you mentioned data for avatrombopag in third quarter. It kind of slipped it to full Q. Would that be kind of only part of a Q4 ? For Kineret and Gamifant phase III trial for COVID-19. Given the patient enrollment now, and you mentioned increasing the clinical sites, do you think we should expect the data at least before year-end? The last question is on EBITDA margin. Second quarter EBITDA margin of 33% is similar to that of last year. Should we expect the full year 2020 EBITDA margin to be similar to 2019, which was close to like 42%? Thank you.
Thank you, Eun. Maybe I start just priming it and then I can invite Milan and Henrik also to comment. Let's start maybe with regard to these COVID-related questions. It's always the question, some of them, let's say, will be phase III grade. Will this be enough to get an indication? We just make the data available. We think with all this information and data that we collectively providing, at least there's meaningful evidence generated. I think this is reflected in some of the positive views that we see around the world regarding the product, in particular in view of this very favorable safety profile.
We will see quite a lot of data now coming in during the course of the year. Obviously, you have seen a reduction of ICU patients in Europe, but you have seen at the same time significant number of ICU patients in Europe and other parts of the world. With this, there's sufficient patient potential. The other thing is now with the CIT trial, actually we are on track exactly where we wanted to be. We will now, in this quarter, we'll basically conclude the trial, will then prepare submission. We are still on track for 2021 launch in the U.S. I think we are quite happy now that basically this works out. With regard to the EBITDA margin, I think you have seen this, that where there was a rise, obviously, during the Elocta part last year.
I think we would rather stay consistent with our guidance, five and a half%-6.3%. It basically is the EBITDA margin that it will be. Let's say, also in terms of top line, we don't want to speculate too much, but it will be, let's say, somehow in a range. I would rather refrain from providing a more precise guidance. Maybe we start with Milan. You want to comment on some of the questions?
Yes. Thank you, Edwin and Eun. With respect to the CIT trial, I agree there's not a delay. You can say it's more like whether you'll get data at the end of Q3 or early Q4. I think that one is okay. We have the COVID-19 study. We initially was under the impression that we would be able to enroll the study in Italy. We have now four and six sites. With the reigning pandemic, we're moving to the U.S. I think maybe unfortunately for the community as such, the pandemic continues. We plan to add probably around another 10 sites in the U.S. in order to complete enrollment of the trial. I think it's difficult to speculate. It depends very much on how the pandemic evolves, how long time it would take to enroll the patients.
I think, I don't know, Henrik, there was a question for you also, I think.
I think yeah, actually.
Oh, okay.
We are not guiding on specific margins. It's a range and it depends on where we end up in that range.
Yeah. Maybe we then open the floor to other questions. I hope you answered the question.
The next question is from Christopher Uhde, SEB. The floor is yours.
Hi there, congrats on a solid quarter despite difficult circumstances. The first question, the EU ITP timeline is still 2021, but why the delayed launch in CLD in the EU? I think at the deal announcement, it was originally 2019. That's the first question. Can you provide some detail on your expansion into Asia? Particularly, what products are sold directly by you there now, and what are your plans for the future with your current stable of products?
Sure
those in the pipeline?
Yeah.
Sorry.
Yeah. Perfect. Maybe we start with CLD. CLD is approved in Europe and basically what held us back a little bit was COVID and supply chain. Because we got a certain formulation approved, now we have everything in place, but it is very tough at this moment of time to create the right level of excitement. We think that the CLD launch will be late Q3, beginning of Q1. Yeah. Q4, sorry. Q4. There's nothing more to it. The product is registered, so we eager to get into the weeds of it. Basically, beginning of 2021, we should be in a good close for ITP should everything works in Europe. With regard to Asia, I think when you look at the number, for instance, of HLH patients in markets like China and Japan, then this is very significant. Yeah.
This prompted us to rethink geographic diversification. For these two markets, we take ownership ourselves because we know what it takes. I've worked 18 years in this part of the world to build representations there. We have made quick strides and we have been able to win a chair from a big pharma company who is running one of the largest companies in China. We have a very experienced team in Japan. We have a very experienced team in China now. Basically products like Gamifant, like Kineret, like Doptelet, then obviously Selecta and also Kineret, it will make perfect sense for us to launch those products and have a very significant, let's say, expansion of our overall global franchise. We think that these were strategic moves and very excited about Asia.
We have already got one or the other accolade, for instance, now in China going. We are very optimistic. Current sales is zero. Yeah. These are pre-operational activities, but we may actually be able to record our first sales next year in China. Japan, 2022.
Okay, thanks. A couple questions on hemophilia and SEL-212. Hemophilia, in the wake of the U.K. tender agreement, will there be any temporary negative impact from lower pricing? If so, when should we expect it? As far as hemophilia factor consumption is concerned, how much of the effect year-on-year was the result of lower activity on the part of patients and how much is from fewer surgical procedures, if you know? For SEL-212, are there any obvious potential antitrust issues that I'm missing, or do you expect this to be straightforward from an antitrust perspective, at least? Lastly there, is there a scenario in which SEL-212 could get accelerated approval on the basis of COMPARE?
Yeah. I think, why don't we take it one step at a time? We were listed in the U.K. tender, very happy about this. The price concessions, let's say, that we have made in the U.K. are within a reasonable frame actually we enacted this already ahead of the tender. We are very happy with the outcome of the U.K. tender. With regard to the consumption versus reduction as a consequence of activity and surgical procedure, that granularity, unfortunately, we do not have. Yeah. Consumption effect in Q2 is more than SEK 200 million. Surely, that gives you a little bit of a flavor where we are currently at. Perfect. Yeah. Then with regard to the SEL-212, there, we don't foresee any antitrust because the launch sequence is around end of 2023, 2024. We're not aware that we are in violation of anything.
We should be able to launch this, and we are very excited once a year also, we can publish the phase II data, let's say, of what is productive.
Yeah, great. The last one was about whether you could get accelerated approval for it on the basis of the COMPARE trial.
No. Maybe Milan, you have a view on this? I don't think so, but maybe. Milan, what is your view?
Yeah. I think we are encouraged, you can say, by the differentiation potential of 212, also with the rapamycin tolerance induction. To your point, Guido, I think it's too early to speculate whether that, you can say, potential differentiation would translate into an accelerated approach. We are encouraged by 212.
Okay. Thank you very much. Appreciate it.
Thank you, Christopher. Appreciate it.
Our next question is for Peter Sehested.
The floor is yours. Yeah. Hi, it's Peter from Handelsbanken.
Bunch of questions, but I'll just fire two away and get back in the queue. The first one on SEL-212. Just wondered how we should look at the data when it comes out here in Q3, Q4. In particular, in view of the fact that the response rates seen with KRYSTEXXA in combination with methotrexate, they are topping at 80%-100%. I am fully aware of the issues with methotrexate, but on the other hand, every rheumatologist on the planet has probably experience with that product, whereas very few, probably nobody with rapamycin. On some of data, some perspectives on how you see the differentiation versus KRYSTEXXA plus methotrexate. Secondly, on the hemophilia franchise. Should we anticipate that Elocta and Alprolix will be back in growth mode during Q3 and Q4? Thank you. I'll jump back into the queue.
Yeah, maybe we start with SEL-212. We know that basically KRYSTEXXA has a certain group of patients. I think they have made announcements, how many patients they currently have on the product. You can read the report. It's a fraction of the 16,000 that I just mentioned. It is because of the immunogenicity that we think we can address very well. It's not just side effects because the product, let's say, doesn't seem to work also in certain areas. We think that our combination is going to be a meaningful addition at least for a larger group of patients. With regard to hemophilia, if you believe that, let's say, the consumption reduction is of temporary nature, which we believe, then you would assume that the product will grow again in the rest of the year, the hemophilia franchise. Yeah.
maybe, Milan, you want to add some additional flavor to ImmTOR and the differentiation of Selecta's as SEL-212?
Absolutely. Thanks for the question. I think, yes, we can say the rheumatologists are used to it. Rheumatologists will not be the ones that have to take the combination. I think in this particular space with gout patients, I think methotrexate has a significant number of black box warnings across a number of different organ systems, from the bone marrow to the kidney, to the liver. The dose has to be adjusted in patients that have chronic kidney disease. We know that there are also convenience issues with KRYSTEXXA. Every two weeks, plus methotrexate, plus folic acid, versus you can say a once-monthly therapeutic option that covers everything. There is the alcohol issue and the liver toxicity with methotrexate.
While it may have achieved some acceptability in a rheumatoid arthritis space, I am less confident that you would see the same acceptability, you can say, in a refractory gout space. I think having a combination with the tolerance induction, I think we feel quite comfortable about where we are and the potential for 212 to differentiate itself.
Just a follow-up question here. Correct me if I'm wrong, but doesn't rapamycin have a boxed warning as well?
rapamycin also has, you can say, safety and also a black box warning, but it doesn't have the systemic boxed warnings that you see with methotrexate, that more or less every organ system is affected. There's even a prescription restriction on physicians having to understand methotrexate. I think out of the two, I think rapamycin is far more benign.
do you think you can evade the box warning on the cell-
No, I don't think the idea is to negate box warnings. Definitely not. I think the idea is more, what is the relevance of the toxicities observed in the target population that you want to treat? And what is the likelihood that any of those safety liabilities would have a translational impact into the patient population? And here, I see more of an impact of methotrexate than I see of rapamycin.
Okay. Thank you. I'll jump back in the queue. Thank you very much.
Thanks.
Next question is from Emmanuel Papadakis, Barclays.
Thanks for taking the question. Emmanuel from Barclays. Maybe I'll take a couple ones, follow-up. If you could give us a little bit more color on the regional dynamics, particularly how France is looking. Maybe quantify for us the potential in the U.K. Where I'm really going with the question is, you talked about the SEK 140-SEK 150 destock in Q2 and lower consumption. For us to get anywhere close to consensus expectations this year, for the full year, for the second half, would need a pretty significant recovery. Your confidence in that and how regional dynamics might help that would be of interest. The second question, Guido, really is a bigger picture question around guidance. You've reaffirmed guidance this morning.
We've discussed in the past, after a very strong start to the year, that it seemed like you might have room to increase guidance. Consensus expectations currently sit at the top end of your existing guidance range for both revenue and EBITDA. Your confidence in meeting that upper end and how H2 may facilitate or not, scope to increase that would be of interest. Thank you.
Mm-hmm. Yeah. Thank you. Just maybe let's start with hemophilia. I just saw the GRS data from the first half in France, which is obviously an important market from us. There, basically, our consumption data mimic the market data. We have not given in market share. In fact, we have gained patients and on a net basis. That actually gives us confidence that we still have a very competitive package. As I mentioned earlier, we have become the number one prophylaxis product in hemophilia in Germany in Q2. There, let's say, it's also resonating. We have, overall in Europe, gained significant number of patients despite the impact on lack of face-to-face interaction. I think most of you have seen these studies where face-to-face interaction versus the current environment has a 30%-40% productivity difference.
Just recognizing this, I think, and people have other worries than switching patients typically in COVID times. That gives us also confidence in Europe that basically we should be back. Obviously, there is a proliferation of competition, but we hold firm on our offering. We have the FLORIA platform, let's say, expanding. The product advantages we have talked about in many sessions. We think we have a strong offering. With regard to the U.K., I commented on. I think we are quite actually satisfied with the outcome because we are no longer held back now in this new environment by the share of the market that we are allowed to compete in. That gives us a good opportunity also. I think obviously, when you look at hemophilia mid to long term, there will be limitations to growth.
Yeah.
We have also fitusiran knocking at the door, which actually looks pretty good as we speak. We think we have a significant role to play.
Yeah.
We don't give guidance now on a product basis, but as I alluded to earlier, it seems that we should be able to show growth in the following quarters, and therefore we see no reason to change our guidance. Whether we are now at the higher end of the guidance or not in this environment, I don't want to precise our guidance. Guidance is guidance. We are confident that we will be in line with the guidance, and you can rest assured that we will do everything to be at the upper end. That's what I can tell you. I'm not now, let's say, basically narrowing the window of the guidance. I think this would not be sound.
Thank you.
You're welcome.
Our next question is from Viktor Sandberg, ABG. The floor is yours.
Hi. Thank you for taking my question. First of all, I just wondered if you could give any indication of when you're going to pay the upfront payment to Selecta for the licensing agreement. On the same topic also, Selecta said that they see cost savings of at least $150 million with the Sobi deal. How much of that will be increased cost for you going forward? I can take those questions first, and then have some follow-ups.
Yeah. With regard to the upfront payment, the upfront payment will be due upon closing, which we expect within the next one or two months. We don't expect any issues with the competition authorities. This will become due. Henrik, you want to mention more about the accounting of this, now you see this?
No, it's absolutely right that we expect closing to occur relatively soon, and then we pay, and we capitalize the upfront.
The SEK 150 million that Selecta can save, I think this is baked to a certain degree in our upfront as well.
Yeah. So when it comes to-
Henrik, you want to comment?
Yeah. What we say regarding the guidance is that the guidance excludes any impact from Selecta. When we close, we indicate, it's in a note there in the report that it could mean increased R&D spend of up to SEK 160 million for the rest of this year.
In SEK, yeah.
short-term impact. We will-
In SEK, yeah.
Yeah.
Henrik, yeah.
In SEK, yes. We will have to come back to the longer-term impact of this development.
Okay, thank you. Staying on Selecta for SEL-212, you talked about the 66% response rate. If you do a modified intent to treat analysis on the higher dose cohorts, 10-12, putting back patients that discontinued, it seems like your response is closer to 46%. Can you speak a bit how you have optimized the COMPARE trial to limit discontinuation? Where you expect the response to end up? Maybe how much better you need to be in order to be outside of the confidence interval to its superiority for that trial? Thanks.
Milan, you want to comment?
I think it's difficult to compare studies across, as you correctly point out. The 66% refers from, say, sort of phase II evaluable patient analysis. I think even in a comparative study, the patients that you can say withdrew for non-safety-related adverse events or non-withdrawal criteria would also be the same in the KRYSTEXXA study. The differentiation potential of 212 and KRYSTEXXA, I think, as I said, and this was also announced by Selecta in December 2019, they have seen a numerical imbalance in the withdrawal rates due to the less than six milligram criteria of withdrawal criteria for uric acid. They have seen that in favor of 212, both for the, you can say, stopping criteria, but also to a certain extent for adverse events. This is why we continue to believe that 212 would be differentiated against KRYSTEXXA.
The 212 study is sufficiently powered to detect what I would say a meaningful difference between 212 and KRYSTEXXA on sustainability of being able to lower uric acid.
Okay, thanks. Just a final question on Doptelet. Can you give any more flavor on how the launch is going on ITP, any patient numbers, prescription data that you could share? Also maybe a quick comment on Novartis that is planning to file a food effect reformulations in 2021. How do you view that competitive threat to Doptelet? Thank you.
Yeah, thank you. The product makes very significant progress. You have seen 52% growth quarter-on-quarter. That's very positive. That's basically also reflected in the number, obviously, of patients now that we have been able to increase. I think the ITP, obviously, we were a little bit impacted, like many other companies, by the lack of ability to see physicians. Yeah. When you look at the data from the U.S., from IQVIA, 30%-40% less NRxs in this time period from end of March to beginning of June. This was most of the quarter. In the second part of June, things were coming back, clearly had an impact on our launch. The hope is by the opening of the economy, we will be able to accelerate the pace here again. That's really what we have in mind.
Let's say, we are very positive by the product. We also think that the CIT indication remain convinced will be a significant move for the product. The evaluation of the product in our books has not changed. Basically, the advantages, maybe Milan, you want to summarize how you view the new formulation from Novartis, from Promacta. We think that we will continue going strong irregardless.
Yeah. I think, we have also seen this. We have not seen any data, the safety liability continues to be the same when it comes to liver toxicity. Even if there is, you can say, a blunted or a less aggressive food effect of the new formulation, which remains to be seen, the fundamental issue around the toxicity profile is unchanged. We continue to stand by the differentiated profile of avatrombopag. I think when you look at the totality of the package that avatrombopag can provide, I think it's very meaningfully differentiated against any other TPO in this space.
Okay. Thank you very much for taking my questions.
Thank you.
Thanks.
Our next question is from Sten Gustafsson, Nordea. Over to you.
Hi, everyone. Thanks for taking my questions. A few. First of all, on Elocta, just to make sure I understand it. Should we use the Q2 sales figure, adding back the stocking effect, and then look at some patient growth going into the second half when you talk about that you see growth opportunities for that product? That would be the first one. My second question is regards to your OpEx spending, if you could perhaps help us with the phasing of how that will develop in the second half. My final question is if the CIT indication is included in the SEK 500 million sales potential you talked about in, I think it was in the Q4 presentation half year ago. That would be helpful. Thank you.
Maybe we'll see if we start with the CIT. We looked at the product, and we gave the growth guidance as holistically. If CIT really works well, you can model yourself, obviously, 70,000 patients. That basically should give you some comfort for the guidance that we have given on the CIT strength alone. 70,000 patients alone in the U.S. This is not the time for us now to change the guidance.
Okay.
Yeah. I think that gives you a little bit of a flavor. Sorry, the first question. Can you repeat the first question one more time? Sorry.
Yeah. That was when you talk about Elocta growth for the second half.
Yeah
Should we add back the stocking effect, you said SEK 140 million, SEK 150 million to the Q2 number and look at growth from that level? Is that representing?
Yeah. I think, basically, the stocking effect is really something that we had in Q1, now it's in Q2. That basically increases your base for Q2, and then you have, obviously, and then basically you will have patient growth that will drive ultimately sales growth. The question is only do you still have an overhang a little bit of consumption saving because people are still affected by COVID in terms of Yeah, I think elective surgery will be a little bit down also in the second half of the year. We heard that in Q4 that should normalize. The main driver is probably that patients now get straight into the right regime. There we are working with physicians as well as with patient associations to make sure that patients don't underdose and are enjoying the full protection.
There should be an offsetting effect in the second half of this year. Yeah. Let's say, in this regard to OpEx, one of the main drivers of the OpEx is going to be some of the studies that we are undertaking that we are now ramping up, like CEMI 010 , like the acute graft failure study. This is impacting OpEx, and obviously we want to remain competitive launches in Europe for CLD and the pre-launch or end launch and hopefully, depending on how it falls for ITP. That basically has to be seen as main factors. Maybe, Henrik, you want to comment to give it more of a flavor?
Yeah. We do expect a generally higher activity level in H2 than we've seen in H1. It's not like we think COVID is over, but we do expect an easier environment to operate in. In addition to what you said, Guido, we also continue the international work, including not only China and Japan, but also Russia, preparing for the future launch of [Doptelet].
All right. Thank you.
Sten, does that answer your question?
Yes. Is it fair to assume that it will be more Q4 than Q3? In Q2 we saw OpEx coming down. When do you expect it to increase, basically?
Over the full half year, obviously, Q4 is a much higher activity level quarter than Q3 in general. More in Q4 than in Q3, obviously.
All right. Yep. That makes sense. Thank you.
Thank you.
Next question is from Christopher Uhde, SEB.
Hi. I just had a couple of quick follow-ups. I guess the manufacturing revenue, two consecutive quarters of quite high performance. Should we be expecting that to drop back down, or is this the new normal? The last question I have was, this type 2 variation submission. I'm a bit confused because I thought that was basically a reformulation. Is this an sNDA or a type of thing equivalent for Europe? Why bring it up if there are no new safety findings?
Okay. Maybe we start with the safety findings. Milan, you want to comment on this? This is a new formulation.
Which variation application are you thinking of, Christopher?
Sorry?
Which variation application are you thinking of?
It was the one referred to in the report. Yeah, for the Sobi.ANAKIN-301 in Still's disease.
I need to come back to you on that. Sorry.
Okay, thanks.
That's not really the mainstream, because manufacturing income, this is a relatively stable business. Yeah. The growth that you see now, we are here following, obviously, Pfizer's lead. I think if you want to know over the longer run how our manufacturing revenues are performing, you just look at the forecast for ReFacto.
Okay, thanks.
Appreciate it. Thanks.
Our last question is from Peter Wessman, Handelsbanken.
Yeah, it's Peter again. Thanks for taking my follow-up. They were actually related to cost related to SEL-212. If you look at Selecta in 2019, they reported SEL-212-related R&D costs of roughly $26 million U.S. That is roughly, let's say, SEK 266. That is just for the smaller studies. Assuming a larger phase III study to be initiated this year, enrolling into 2021, perhaps 2022. Just a doubling of these costs sounds sort of in the lower end of what we should expect in terms of additional cost for 2020. Sorry, 2021, 2022. Is that sort of the right calculation/way to look at it?
I just want to get back to Elocta and the competitive landscape in France. I think one thing that sort of spooks the market a bit is that you talk about additional patient growth across the board, but in France, you specifically just mentioned that you are maintaining your market leadership, which basically could assume that you are maintaining the leadership in the replacement factor segment, but that the overall market share of that segment is going down. My question very specifically, have you seen patients switches out of Elocta and into other products during Q2 in France? Thank you.
Maybe, Henrik, you want to talk about it?
Yeah. I think, Peter, I don't contradict you when you say what you say about the cost for the phase III trial, but I think it's fair that we come back with a firmer opinion once we've actually closed the transaction.
Okay. Then on Elocta and switches out of Elocta in France, if you'd seen any of that during Q2.
Actually, to be honest, we had a net patient gain. There were, in fact, maybe two or three switches from Elocta, but most of this was overcompensated by the gains, yeah. We are still going strong, yeah. The overall number of switches to Hemlibra is minimal for us.
Thank you.
You're welcome.
We have no further question. I give the floor back to you for the final remark.
Yeah. Thank you so much for your interest. Apologies if some of the questions were not sufficiently answered or they were not broad enough. At least you can see there's quite a bit of robustness in this business. Q2 deserves a bit of a second look, some additional comments. As hopefully we have communicated, we think actually these are solid results and further building the future. Thank you so much for your interest. Wish you a great day. Talk to you soon. Bye.
This now conclude our conference call. Thank you for attending. You may now disconnect your line.
Thanks.