Earnings Call: H1 2021

Jul 27, 2021

Dear ladies and gentlemen, welcome to the conference call at EYdarsia regarding the Half Year Financial Results Presentation 2021. At our customer's request, this conference will be recorded. As a reminder, all participants will be in a listen only mode. After the presentation, there will be an opportunity to ask questions. May I now hand you over to Andrew Weiss, We will lead you through this conference. Please go ahead. Thank you, Angelo. Good morning and good afternoon, everyone, Welcome to the eidorzea webcast to discuss the first half twenty twenty one results published this morning at 7 am Central European Summer Time. With me on the call to provide additional granularity on our operational, clinical and financial advancements over the first half With me, our CEO, Jean Paul Clozell our CFO, Andre Mueller. They will be making prepared remarks. For the Q and A session, we will be joined by our Chief Commercial Officer, Simon Jones. Next slide. Before handing over the mic, a few customary remarks, I. E, we will be making forward looking statements in this call, which may or may not turn out to happen. Hence, you have been appropriately warned about the risks and benefits of investing in eidorsa shares. Next slide. Thus, without further ado, Jean Paul, the floor is yours. Thank you very much, Andrew. During the 1st 6 months of this year, Hydroxy has made tremendous progress to become a fully fledged biopharmaceutical company. Next slide. If I see the main highlights of this first half, You will understand why I feel so confident that we're on the good track. As you have as we have discussed already with you, the direct and NDA has been submitted in the U. S. The EMEA has been submitted at in Europe and the submission has been also been made with Swiss Medic. Bonizimod, which is a drug from VORI sold by Johnson and Johnson has been approved in the U. S. And in Europe, which shows the quality of the clinical program, which was set up by Actelio and by the team, which is now within EYdorsia. The Cladot and Tan NDA has been submitted in Japan. And also, we have initiated the Phase III study with the selatogrel for suspected myocardial infection. In addition, within a few months, We are going to get the results of the study, the Phase III study, the pivotal study with lusterostat and the Phase IIb of cenerimod, where we will get The result of apocitelten ten in the middle of next year, but For apocitelan, all the patients have been recruited. Next slide. So when I mentioned to become a fully fledged biopharmaceutical company, what does it mean for us? It means mainly to fulfill 5 strategic priorities. These are the priorities we had from day 1 of the creation of Aygorsia, and We have not changed these priorities. So first, we wanted to deliver 3 products to the market. And I am not counting into these 3 products, polyimod. And you will see In the next slide, the progress of the pipeline and why we believe we can reach and maybe be better than this goal. Number 2 of the second strategy priority is to build a world class commercial organization. This task has been given to Simon Jones, and we are progressing extremely well in order to have this infrastructure, which will allow us to market our drugs. Number 3 is to bring hydrosia as soon as possible to a sustainable and I would say also to a growing profitability. We are doing everything That in the midterm, we can really become financially independent. Number 4th goal is to continue to fuel our pipeline with new discovery from our own research. I always say that drug discovery is the engine of a biopharmaceutical company. It's like in a car. In a car, you can stop the engine and you can continue to run, but you won't run very far. Without New drug discoveries, a company cannot really grow and cannot have a future. This is why it is So important for us to continue to build our pipeline by bringing new drugs within this clinical pipeline. Finally, the 5th goal of Hydrosia was to utilize state of the art technologies In every, I would say, department or in every areas of the company. So You will see that we are using these new technologies, not only in drug discovery, but also in clinical development and in marketing. Next slide. So let's look at the pipeline. Our goal was to put on the market 3 new drugs, and we are really one on the way. Daridorexant, Our dual orexin receptor antagonist has been filed, as I've mentioned. The review is ongoing, and it's going, I would say, very well. Aprucitentam is a dual underdelig receptor antagonist. It is for the treatment of difficult to treat or resistant hypertension. And at present time, the study is Fully recruited and we will get the results in the middle of next year. What I have to say, I think that we've got more than 5 DSMB review, and we have not heard of any safety concern. Clazosantan is a nonothelial receptor antagonist intravenous for the treatment of vasospasm or and prevention of sorry, prevention of vasospasm with annebrysen steroid after, sorry, I'm the reason I'm sure by Nori Dolemorage. You have heard that we had very positive Phase III in Japan, and we are going to get the results next year of the REAP study, which is more or less a similar study performed in Europe and in the U. S. Lucerastat is tested in Fabry disease with a very interesting clinical protocol, which is evaluating not only the effect on the biomarkers, but the effect also on the serostat, on the clinical symptoms, especially the neuropathic pain, which is the main problem, clinical problem in this patient with Fabry. Selatogrel has Been starting the Phase III study, has been started. We had an FDA With the FDA, which means that the FDA agrees with the protocol that we are following for the Phase III and also with the way we are going to evaluate the effect of selatogrel in these patients. Seneremote is our drug for lupus. It's a 3rd generation S1P1 receptor modulator, An optimized S1P1 receptor, and we are waiting the result of the Phase IIb, which could, if the study is positive and consistent show consistent results, which could be used as a pivotal trial, which means that if this study is positive, we might have only one more study to perform before the NDA. We have also other drugs which are moving within our pipeline. I Just can mention a selective orexin 1 receptor antagonist for binge eating disorder, which is recruiting in Phase II and some other products coming from our drug discovery, which are in Phase I or close to initiate Phase II. Next slide. Coming back to direct to Exane. I have mentioned and we have mentioned many times that the results were very consistent and showed an effect of the drug during the night, improving sleep, but also showing FX during the day consistent with an improvement of data and functioning. The drug is now in discussion, so we are answering questions from the regulatory authorities. And I think the process is going very well. And we really should be in a position to launch in the U. S. In the beginning of next year, this drug and in Europe and Switzerland later on during the year 2022. Next slide. I mentioned also that selatogram has started a study in a very interesting new indication, which is really to give the patient the chance to prevent this myocardial infarction or to have it in a much less severe form, and this can be obtained by having him injecting himself the platelet aggregation inhibitor, which is selatogrel. It can inject with an automatic with device. And after that, it can call the ambulance, it can call the doctor and then going to the hospital to be treated. But usually, the time between the first pain And the time the patient is treated within the hospital is in average 3 to 4 hours, Depending, of course, if you are living in a big city or in the country, but it can be and you can imagine in the United States, especially With very long distances, it can be 6 hours. So we have agreed with the FDA that we are going to do a treatment sorry, doing a study where half of the patients will be treated with placebo, half of the patients will get this auto injector And we treat be able to treat themselves while they have the first signs of a new myocardial infarction because we are dealing with patients who already had a myocardial infarction so they can recognize a second incident. Next slide. So the second goal of Agrosia is to build a world class commercial organization. We clearly Our putting priorities on 3 regions, the U. S, Europe and the main countries in Europe and Japan. We have established affiliates in the U. S, in Renault, in France, in Paris, in Germany, in Munich, in Italy, in Milan, in Spain, in Madrid, in the United Kingdom, in London and for Japan in Tokyo. We have recruited the General Manager, and I have to say That I am very happy to see how many top talents we can recruit. And sometimes, I wonder While we are able to attract so experienced people who have already launched several drugs, who know the market, We know the regulatory authorities, and we know the processes needed to succeed for launch of new drugs. And frankly, I think that the recent mergers being Sajine with BMS, being Anaxiom bought by AstraZeneca, All these changes have created some opportunities for people to either choose Staying within large companies or joining companies like Agorsia, maybe with a little bit more entrepreneurial, maybe a little bit more risk, But certainly, with a very different culture, more close to startup. Next slide. Finally, we want to utilize state of the art technologies to drive innovation. And this is, for example, used in drug discovery, Intelligent artificial is used now to select new drugs to help the drug discovery process. We tried to make it something that is available for all the different departments in the drug discovery department. It is also Artificial intelligence, for example, is also used in clinical development to be able to best Use our data, our data sets and the millions of data points we have created By doing studies and, for example, chronic studies like daridorexant, we are trying to use the most modern technology to analyze this data and also to also use This information to discuss, for example, with regulatory authorities. But we are also using modern technologies For marketing, today, social media have a huge impact. Today, it's possible to address, to select The doctors who are more likely to prescribe our drugs, but we can also inform the patients And select the patient by using the most modern tools, which can now allow To have a much better selection of the patients who require the type of drugs which we are developing. Next slide. We want to continue to have a permanent inflow of new drugs Within our pipeline, our clinical pipeline. And this is really something which is very important. I do believe that with the drugs that we have now in late stage development, we have potential for growth for the next 10 years. But after these 10 years, we need to continue to grow. We need to have this long term view, and the clinical Development team needs to get every year 1 or 2 or 3 new drugs to test if we want to be able to market in the future new drugs in addition to the very rich pipeline that we have already. This drug discovery organization is still based on the single center approach, focused on small molecules, organic chemistry with a fully integrated research informatics, with Multiple therapeutics areas, but focused on few platform of expertise, for example, G protein copper Some enzyme are our key expertise areas. And of course, with a very, Very high medical input. We absolutely want to develop drugs for fulfilling high medical needs. Next slide. Finally, as I have mentioned, we want to bring Hydorsia To sustainable profitability. How we are going to get there? Clearly, We are in a very particular situation because our revenue, we have 2 main streams: First, milestones and YLT streams, for example, coming from ponazimod, but also in the future at prostitantan and hopefully from the T type calcium channel blocker, which has been licensed out to Neurocrine. But we will have also our net sales coming from Primary Care, from for example, for tarydorixant, but also for orphan drugs like lucerastat, clazozantan and specialty drugs Like Cenerimod and Selatogrel. So all the organizations that we are setting up now To launch daridorexant and clazosanthan in Japan is going to be leveraged when we are going to have the results of the new drugs, and we are going to be able to launch other drugs in addition to daridorexant. Next slide. Now Andre is going to discuss the financial numbers from these 1st 6 months of the year. Yes. Thank you, Jean Paul. As you rightly said, the preparation for The product launches with Directland and Kazakhstan Japan are well underway. So let's move, operator, to Slide number 14. It's the usual slide on how our operating and net results came about. Starting from left, So we see revenue, actually EUR 13,800,000. I would start with a smaller number, which is actually EUR 0.4 €1,000,000 corresponding to the 8% revenue sharing of the initial net sales with the launch of Vanadiumod by Johnson and Johnson this year, of course, of Q2. Another one, which is relating to see a milestone paid by Mosheeda in the first half In connection with the 1st subject, 1st visit of the bridging study, Phase 3 study in Japan For daridorexant, €1,600,000 was recognized from €8,400,000 paid And also rest, I. E, roughly slightly less than €12,000,000 where these are deferred revenue from a previous collaboration that hydrocia entered into with J and J for APOCIT10 with Neurocrine for the calcium T channel blocker with Mosheeda, as Josh mentioned, for Dari Direct and Comacting in Japan. We'll come back just in a few minutes to see non GAAP operating expenses, EUR 248,000,000 leading to a non GAAP operating result of EUR 234,000,000. If you add the depreciation and amortization of EUR 8,000,000, The stock based compensation of €9,000,000 you end up at €252,000,000 which is our U. S. GAAP operating results. Below the EBIT, you see here a positive number, EUR 8,000,000, mainly driven by currency exchange gain on our deposit in U. S. Dollars. Hence, we ended up with a U. S. GAAP net result of EUR 243,000,000 Next Slide, 15, please. Yes, we provide a breakdown of the Non GAAP operating expenses. So as you can see on the right hand side, EUR 248,000,000 So going up significantly, mainly in SG and A. And of course, if you're looking at this EUR 68,000,000, it breaks down between commercial with EUR 32,000,000 significantly up with the preparation and Yes, of the upcoming launches and also G and A going slightly up, not only at headquarter, but also in the affiliates. If I go from right to left, we in order to launch, We also start to build inventory in drug substance, drug products and finished product. We paid a milestone of €5,000,000 in connection with the filing of Went also up, breaking down between clinical, euros 74,000,000 And Chemical and Pharmaceutical Department, EUR 42,000,000 Another way to see it is actually EUR 46,000,000 functional OpEx and really the rest is We need to see clinical assets with EUR 46,000,000 study costs, 14,000,000 drug substance and 10,000,000 drug product. Research went slightly up with 54,000,000. So as you can see and as explained by Jean Paul, it's really all about properly preparing the upcoming launches Yes, either region, U. S, Japan. And it has a much lower impact So right now, EU5. Next Slide, 16, please. Just to mention our cash flow. As you know, we started the year with €1,200,000,000 liquidity. If you take into account the non GAAP OpEx we just discussed, The €8,400,000 or €1,000,000,000 paid by Mosheeda In connection with initiation of the bridging study for daridorexant in Japan, dollars 17,000,000 CapEx and EUR 16,000,000 other outflows, mainly working capital requirements. We end up with a liquidity of EUR 927,000,000 by the end of June. Next Slide 17, please. Here, you have a comparison of the liquidity With the start of the year and the closing of the first half, what is important Also is to see how this liquidity is broken down between different currency. EUR 6.81 in CHF 3 and EUR 2.37 in U. S. Dollars. CECL dollars are aimed to hedge our outflows in U. S. Dollar We see upcoming launch of daridaxon in the U. S. So it's but it's a natural hedge, I would say. It's not a U. S. GAAP Accounting hedge 10, and you were alluding to it, the fluctuation on the currency from 1 quarter to the other. Next slide, 18, please. Let me finish With the guidance for 2021, as you've seen, we reduced the guidance by roughly EUR 20,000,000 with functional R and D at EUR 360,000,000, So around EUR 10,000,000 less than the previous guidance. Functional selling and G and A Expenses at €220,000,000 so another €10,000,000 lower than initially guided. Still an inventory built of €35,000,000 even if we had only €6,000,000 in the first half And no other milestone payments except the one already paid in Q1 2021. So with this non GAAP operating expenses, excluding, of course, unforeseen events, should be around EUR 6.20 million. If you add €20,000,000 D and A €25,000,000 SBC, we would end up with the U. S. GAAP operating expenses around EUR665,000,000 With this, I hand over to Jean Paul. Jean Paul? You're on mute, Sampo. Sorry. Thank you, Andre. Next slide. So just this slide summarizes the main milestones, which will which has happened and will happen in and next year. So at the beginning of this year, we had, I repeat, the filing of And in the U. S, Europe and Switzerland, we had the filing of clazosantan in Japan and the initiation of the SOS AMI trial for selatogrel. Now in the coming months, We are going to get the Phase III, the pivotal trial of Lucerastat. And we are also going to have the result of the Phase IIb, which can become a pivotal trial depending on the result of Celery Month. In the beginning of next year, we are going to launch Directxant. We are also we should get the approval and should launch clazodentan in Japan. And in the middle of next year, we should have the result of aprosytantan in resistant hypertension and at the end of next year, the results of Clazosantan. That means all our late phase products will be we will have the results of all our Phase 3 products at the end of next year. And as you can see, the company, Hydrosia, We'll become a very different company. Imagine that next year, we should be a commercial organization with The launch of Daridorexant. But in addition, we will have launched clazosantan in Japan and maybe have positive results with Lucerastat and Clazozantin in Europe and the U. S. Next slide. That means really that our goal To become a profitable company is really approaching. I think it's not in The too distant future where we are going to be able to become financially independent, not only by having the of course, the ponasimod royalties, but also with our sales of daridorexant and with the sales of Clazozantan in Japan. I do believe that with Dary Direct Center alone and Clazozantan in Japan taking into Our really strict cost control, we can become profitable with these two products alone. And of course, if leucera stat is positive and pleaseratantin in U. S. And Europe is also giving positive results. This organization, the organization That we are creating is going to be leverage, and of course, our profit will grow. And in the long term, Of course, the revenues from Asprosy, Tantan and Cenerimon and Selatogrel will really complete this financial stream of revenues. And I do believe that We have a very bright future, not only as a research and development organization, but as a commercial organization with multiple breakthrough and blockbuster products. Thank you. Next slide. Thank you, Jean Paul. This concludes our prepared remarks section for today. We have crossed the bottom half of the hour And now I can shift over to the Q and A session where Simon Jones is going to be joining us to address them. Operator, please open the lines. Thank you very much. Then we will now begin the question and answer The first question we've received is from James Gordon of JPMorgan. The line is now open. Please go ahead. Hello, James Gordon, JPMorgan. Thanks for taking the questions. A couple on the late stage pipeline, please. First one was just about the readouts. I can see on Slide 19, it looks like we're going to get Lucerastat and then cinerimod. Is that right for the order? Or is that just illustrative? And it could be either way around. So that was the first question, please. Second question is about how you're thinking about China's success for the 2 ones that are coming up, so Cinerimod and Lucerostat. I know Cinerimod beta, we could take I'm comfort from what we saw on the Sleddai score in the prior study and the fact that you've got high dose steroids in both arms, but then lupus has been quite a tough indication for So replicating data sets, how are you thinking about that? And then the third and final question was just scenario mode, what's the range of outcomes Depending on what we see in terms of the timelines with which the product will come to market, because I think I heard that the Phase 2b could be pivotal. So If the data is really good, is it potentially pivotal even as a study by itself or you'd still definitely need to replicate and do another study? And if you did that, would it be similar time lines to the first study? So maybe we'd be talking about like a 2025 approval or something like that. So what's the range of outcomes depending on what we see for Snaramod, please? Yes, James, thank you very much for those questions. I think we're all going to have Jean Paul Answer them. So number 1, timing of Lucerisat and cinerimod is it comps? Is our choice sort of depicting it on Slide 19 Any kind of indication? What is the success and the likelihood of each of the trials reading out given the predecessor data? And what is the range of outcomes of scenario month? Jean Paul, do you want to address those questions? Yes. So I think the Just I have to say, it's planned, the reading of the results of Cenerimod and Lucerastat within a few days. It's falling like that, but sometimes you can't have one center not answering. So it Can be a few 1 week delay or 2 week delay, but it's basically I don't I cannot tell you which one will come first, But it will be very close. The two studies will be very close. And we have more and more, of course, We will add more and more precisions when we are approaching, but that will be within a few weeks, to 2 studies. Now the second question, if I may, Andrew, is about what are the chances of success? How we estimate The chance of success with Cenerimod and Lucerastat. Just for us, Cenerimod, we made a first Phase 2b. We now have done a very large study. And of course, we want to know the right dose, but also the efficacy. I think that We know the safety because the DSMB has reviewed many times this data. So I don't think there is really a safety problem which would prevent the further use of this drug. Now I think that we are quite the team, we are quite optimistic, but you know that lupus It's a tough disease, so we need to see the results. But we had some very clear indication in the Phase IIa, So that should be reproduced in the Phase 2b. For lucerastat, as I have said, we have never tested the effect of the drug on neuropathic pain, which is the primary endpoint. On the other side, now many patients are for more than 2 years Within the clinical trial, I do believe that if the DSMB, which is on blinders and knows If the drug has no effect, I think that if the drug would do nothing, I think that since there are other treatments for Fabry, such as enzyme therapy or some amicus drug, I think that they would have told us to stop the study. But of course, I don't know. I have no certainty. But I think that the fact that this That is going on for now nearly 3 years is a very good indication. And the third question is what do we mean for us of a positive study with Cenerimod. And I think it's very clear for us That for us, really what means positive is not only to get efficacy, but also to get a safety which is really acceptable at the dose Which gave this effect. Of course, we could see effect on the maybe on the At doses which would not be acceptable. But I think, as I have said, we have not been asked by the DHMB to, for example, Stop the high dose. So I think that the safety should be okay. It will be very difficult to compare our trial with other trials because this trial, our trial has a very specific design for the corticosteroid use. As I have mentioned several times in the past, we have tried to optimize the corticosteroid use before Before randomization between placebo and the 4 doses of the drug, in order to avoid Interference of corticosteroid during the trial. This has not been done in to what I know in other Large Phase 2b or Phase 3, and therefore, it will be very difficult to compare the results with what has been obtained. Now finally, can this study be alone sufficient for filing? I don't think so. What we have done is really to prolong the study to have also data after 1 year. This was at the request of the FDA, And this is in order to even better use the data of the Phase IIb. I think that Really, the FDA and other authorities will require another study confirmation. And of course, I believe that because we will have a very good definition and determination of the Those are to be used. This study could be smaller in terms of size than the PRISM study. And we are doing we are preparing ourselves to be ready to initiate this last study as soon as possible and to interact with the regulatory authorities as soon as possible in order to get What we believe is maybe the best overall drug in lupus, which will come to the market. But Let's wait for the results. And of course, we will know much more at this time. Thank you, Jean Paul. Thank you, James, for the questions. Operator, next question please. Yes. The next question is from Peter Rodolg of Citi. Your line is now open. Please go ahead. Thank you. Peter Rodolg of Citi. Three questions, please. Firstly, just a clarification on cinerimod. If I look at clinicaltrials.gov Same primary endpoint in July. So I just wanted to make sure that the data is the data really coming in Q4, could it come any earlier? Secondly, for Andre, maybe if you just peek into 2022. We've got a growing and progressing pipeline. You're getting ready for the Dari launch. That all requires funding. So just to make sure that we're thinking of it correctly, If I think about Citi and consensus right now, it feels that we're probably you need to be way over €750,000,000 in OpEx for next year to reflect the dynamics across the pipeline and what you're doing from launch preparations. I realize this is not The medium for guidance for 2022, but can you just give us some pointers as to how we should be thinking about the R and D and marketing dynamics? And then lastly, on PONVORI, I realize this is a J and J drug, but have you ever shared your perspective of the peak sales outlook for the asset. I'm only asking that in light of what is clearly a very competitive landscape and the fact that you don't have the fatigue data on the label. I just wanted to Jean Paul, whether you could share your views as to what you think the peak sales opportunity of Pom Borje is? Thank you. Thank you, Peter. All right. So yes, on cinariimod, I think I quickly can address that. Yes, we do see 4th quarter as Most likely. And that the clinical trials dotgov probably needs yet to be updated. For On Trade, a question on finances in 2022 outlook, a bit of granularity. And then from Bory, Jean Paul. Andre, do you want to take over the financial question? Yes, sure. Since we are in the middle of the Olympic Games In Japan, I will take an analogy here. It's with the whole race, one whole after the other. Yes. As you can imagine, we have a mid range plan. That's also why Jean Paul So you said we are confident with the upcoming launches, that we will reach sustainable profitability. No longer a question of if, it's more a question of when. Coming to the OpEx base for 2022. There are so many moving parts, Starting with the R and D, will we have cost relating to Cinerimod with Phase 3 following positive results of the Phase 2b and some other moving parts in R and D. When it comes to marketing and selling, yes, sure. I would say it will continue to grow, Especially when beginning of 2022, we will have the Salesforce in place in the U. S. So we will, with Q3, update you on the guidance for the year. Q4 would be a decent proxy, a part of the moving parts that I mentioned in R and D with C and L in U. S. And globally, you can reasonably expect But the OpEx will grow in 2022. We need to have more certainty On the launch date for clozozantin, things are progressing well in Japan. We also need to get A better understanding what could be CA label in the U. S. And then, of Of course, the revenue will compensate for the growing CapEx base in 2022. Maybe I can take also the last one regarding change in Pangauri. We do not get any privileged information. I just mentioned and just recall From here, the merger in connection with the J and J Actenion deal, this is a drug owned by Acadian, I. E, J and J. And to this extent, we are entitled to 8% revenue sharing. Jean Paul, maybe if you want to add your thoughts on Pampori in CMS space? I think that Foundry, which has shown also superiority to Vaggio, which has published data on fatigue, maybe not On the label, but certainly on the published, I do trust that Johnson and Johnson is one of the best marketing companies. In fact, Johnson and Johnson is very well known and renowned for its ability to market drugs. This drug is very It's a very has very clean and clear data. It's both in the U. S. And in Europe. And it's also, I would say, one of the few new drugs that are now coming to the market for Johnson and Johnson. So and it's an area which is completely also open for Johnson and Johnson. So I really trust, but I cannot give you numbers, but I really trust that Johnson and Johnson is going to make a success for POND VORRY. Thank you. Thank you. Operator, next question please. The next question is from Rosie Turnure of Barclays. Your line is now open. Please go ahead. Hi, good Thank you very much for taking my questions. Just 2, if I may. You've spoken quite a bit about how preparations are going with the U. S. Sales force. And that all sounds perfectly on track and great. Just wondering how it's going in terms of commercial preparations ex U. S. Obviously, kind of European approval of daridorexant will follow relatively shortly after the FDA approval, kind of all things kind of continuing on the current quarter. So wondering how that's going. And then just on liquidity, obviously, it's getting a little bit tight in terms of the typical kind of 18 months that the market looks at in terms of cash burn. Just wondering what your thoughts are there, what parts could be explored if you wanted to raise some additional capital going forward? Thank you. Thank you, Rosy, for those questions. So first one, launch preparations, U. S, non U. S. Simon, I think that would be one great for you to take. And then on the liquidity, cash runway, Andre, please. Simon? Yes, sure. Thanks, Rosie, for the questions. I mean ex U. S, the preparation for dairy launch in Europe is going very well. As Jean Paul said, we've established affiliates in the major markets. We've got general managers appointed in those markets, all of whom have got a lot of The fundamental difference in Europe for us is that we will be the first And likely, I think, only Dora to enter the U. S. Market. So the dynamic is very different in that there has been no innovation for 20 years. And the Sightment that we're seeing amongst the specialists and the opinion leader community is actually quite palpable because they have all the same concerns and worries over the use of Zeds and benzos that we see in the U. S, but they've yet to get their experience or hands on Adora. So there's a lot of excitement, and we're working very closely with opinion leaders as we start to develop our strategy. That's all on track. Obviously, it's a few months behind the U. S. Just naturally because of the regulatory time line. And certainly, in Europe, There'll be, as you're well aware, some access work to be done in countries like France and Spain. Italy is interesting because Italy, The insomnia market is self pay, so we can get into Italy earlier than we might otherwise go in because we don't have to go through The reimbursement process. Turning to Japan and to the preparation for the Clazo launch, that's all on track well, we've got the medical team stood up. We've got MSLs in the field. We're engaging with specialists, high degree of excitement there. Similarly, This is a very prevalent condition. It's more than twice the incidents that we see in the rest of the world. So They're sort of acutely aware that they have a very sort of high incidence of vasospasm and SAH. And I think there's a lot of excitement in the medical community there. Because again, similarly, they've had no innovation for, I think Fosseville was 1995 and the evidence of the efficacy of that isn't brilliant. So I think again, I think we're on track there and See nothing pending approval to see a successful launch in Q2 of next year. Thank you, Simon. Andre, liquidity? Yes. Liquidity, I think I made it very clear over the previous calls that we're not funded to break even And that we should not also want to be against the wall. That's why we would like We have liquidity or cash covering our next 12 months cash burn at least. As you know, we are also exploring all avenues, the classical one, equity or equity linked capital markets On top of the J and J credit facility, which we can grow down at any time, euros 243,000,000 Job to mention. And maybe some also other routes like royalty monetization deals That's the advantage of having many assets that could be eligible to such deals. But at the right terms, so this means also at the right timing, you would get much more value If the regulatory risk is off the table with drug approved or on the VERBRA to be approved following positive readout of pivotal platforms. And of course, we have Also the out licensing route where we could try to upfront Some cash in this type of deals. So we have a variety of instruments available to us. We remain vigilant to be able to seize any opportunity if one that would be attractive to us. Perfect. Thank you very much. Thank you, Andrea. Thank you, Rosie. Operator, next question please. The next question is from Greg Stefanovich of Goldman Sachs. Your line is now open. Please go ahead. Hey, good morning, good afternoon. Thank you for taking my questions. I've got 3, if I could. My first is on darodorexant and particularly the European opportunity and while I understand perhaps the opportunity to be the 1st door On the market in Europe, my impression is one where perhaps the reason why others haven't been able to go there just yet is just reimbursement pricing and the market opportunity. So could you provide us your high level comments on How we should think about the European revenue opportunity relative to the U. S. Opportunity, at least in your opinion? My second question just has to do with cinerimod and comments around what's next assuming positive data in the Q4. I've seen some pivotal Phase 3 programs in this indication being sometimes as many as 1,000 patients. And I'm just wondering how and while I know it's early days, If you could provide any high level thoughts on how you're thinking of what that perhaps Phase 3 program might look like And whether it is just one study and if you would need to have a relatively sizable patient population in that Phase 3 study. And then perhaps my last question, well, maybe I'll let you answer those 2 first and then I'll ask my 3rd. Thank you. Okay. Thank you, Greg. On the dairy question, I would actually like to split it in 2, have Simon address the opportunity And then shift over to Jean Paul for the patient need part of it as we do feel very somewhat puzzled sometimes about how European patients are being treated. And then Scenario Mod, can Jean Paul you repeat your comments before on the Phase 3 program. Simon? Sure. Yes, Andrew. Thanks, Greg, for the question. I mean, I think those two points are linked because Part of the reason we see such a big opportunity is the unmet need in Europe is just as high as it is in the U. S. It is a generic market, and you're absolutely right. That means we end up with payer scrutiny. But the generic drugs that these people are dealing with Have adverse events. They've got addictive properties. The regulators are really concerned about their use. In fact, most of the labels of Sleep drugs in Europe limit their use to 2 or 4 weeks. In countries like Germany, they won't reimburse beyond 4 weeks. So they're so having such a challenge with existing treatments. I think if we have the right conversation with the payers and we're talking about the right Population, as you know, with the right sort of price point, then I think that the unmet need will allow us to establish a good position in Europe. What exactly that will look like from a revenue point of view is clearly too early to say. But I don't think I think if we were entering a generic market where the generics We're good and well established and people didn't have concerns, which is often the case in diabetes and other areas, then fair enough. But There is such, such consternation and concern about the current makeup of the market and that we believe with the opinion leader We're seeing that we do believe that these are challenges that are overcomeable. Great, Simon. Maybe I can add to Simon. I think if you take France, you cannot Take that drug for more than 8 days. It's really extremely it's You do not have people forget that we are doing studies with our drugs over a year. And there is no chronic drug There is no one single chronic drug approved in Europe for more than a few days. So we are going to get a unique opportunity. And I think that we should be very, Very careful when we compare daridorexant to other long acting, I would say, orexin receptor antagonist Because the problems of the precedent orexin receptor antagonist was a long half life leading to some dominance in the morning and the side effects, which in the U. S. Has been solved by decreasing the dose and leading to much lower efficacy. So I think that we should really Not forget that daridorexant is sort of optimized orexin receptor antagonist. And also, when you think of the market and you think of Europe, we don't need to get 100% of the market. I would say 20 15%, 20% of the market will be already leading to blockbuster numbers. And this is true in the U. S, this is true in Europe. We don't need to be 70% market share to be very successful. And that is the beauty of insomnia market, I do believe that we will grow with the Redirection for the next 14 years of market exclusivity that we have because we will never be able to treat all the patients we should be treated with a drug that very broad sense. And then maybe I can take over a scenario mode question. Yes. Go ahead. Follow on. As a summary, we have discussed very carefully with the FDA. We have really followed all their advice In order to be completely in line with them because we know that especially this division is very Keen on safety. They know that the lupus patients are sometimes fragile. And this is why We have done huge it's one of the biggest, maybe the biggest Phase IIb ever done in lupus. And we have more than 400 patients treated in this study for Phase II, which And we are also following the patients for a year. And that was agreed with the FDA to be potentially used as the 1st pivotal trial, but depending on the results, I think that in order to be able to use it as a pivotal trial, we need to have a clear cut efficacy and safety, of course. But if the study, which we believe most likely will be positive and show really give us the right dose, I think we will be able to have a study only from with the dose with the same endpoint that we have chosen in Phase 2. And I think this study will require much less than 1,000 patients, as you have mentioned. And this study also will be much Easier to recruit in terms of patients because we will then put a drug for this Phase which will have a very well known and described safety and efficacy. Thank you, Jean Paul. Greg, you had a follow on? Yes, I did. Just on the MS Mark, I'm just wondering the ideal positioning of your product. There's growing emergence of the anti CD20, and I'm just trying to figure out if you have a sense of what the ideal for the target patient population is for the product? Thanks. Jean Francois, do you want to address that? As I said, for the MS drug, for which MS drug you mean, for ponasimod? For poinesimod, yes, what is how does its uniqueness with its PKPD profile, rapid onset, rapid off translate into patient utility? Who is most I think it's clearly an oral drug, so it doesn't need injection, number 1. And I think that the efficacy and I think that the side effect profile has been well characterized in comparison with Another very well established oral drug, which is Aubagio. So I think that we have Many long term data also, which are quite unique because I think that the patients have been followed for 8 years. And this drug is extremely well tolerated. So I think there are many arguments to sell such a drug. You also know that this is very fastly reversible, And you can see in terms of in times of COVID or infections, viral infections, I think it's a very, very big advantage to have a drug where you can stop treating the patients And 2 or 3 days or maybe a week after, the patient has a normal immune system or Close to normal immune system. And of course, if you use a long acting CD20, you are going to be months At risk of this viral infection or other type of even Other type of nocosomal risk of infection. So I think that there are many arguments, and there is a very, very good market position for a drug like pranayzumod, which is, in my mind, an optimized S1P1, which also doesn't need compared to In Golimod, the same scrutiny for the cardiovascular effect that during the 1st days of treatment And which is a much cleaner, I would say, sign effect profile in my mind. So let's see how Johnson and Johnson Can do and can perform. Thank you, John. Thank you, Greg, for the questions. Operator, are they Mindful of time, are there any questions left in the queue? Yes. We have one last question. It is from Thibault Boutheron of Morgan Stanley. Your line is now open. Hello, can you hear me? Yes, we can. Okay. Thank you very much for taking my question. My first question is on the U. S. And semi market and the Dora in particular. I mean, since the launch of AVEGO, we've seen SIS been able to grow that market by about 40% of volume. They are taking around 25% shares, they've done relatively well. Just wanted to add your comments on how you see the evolution of this market, In particular, in the context of COVID, I mean, by the time you launch, the excellent public communication will have improved a little bit, but just wanted to have your thoughts on the current dynamics and what's playing out right now between Merck and EFI. And then maybe just a quick question on simaglutat. Just wanted to know the context of the discontinuation of the natural history study in lysosomal storage disorder and how your thoughts are changing regarding these early stages? Okay, Thibault. Thank you for your questions. Simon, can you address the U. S. Store dynamics and how you see DaVi go and our Lord process moving forward? And then Jean Paul, I would if you could add address the simvaglustat, if we can. I mean, I'm assuming that the comments about the 25% and the 40% sort of growth is maybe looking at that in the context of the Dora Subclass, if you will. Yes, yes, yes. Sorry. Yes. Yes. Because I mean, clearly, the dularexin market itself is Small, I mean, suvorexant has got about a 1% market share. If you look at the uptake so far of lemborexant, I think 1 year in, they probably are About a third of what suvorexant was at the same time point. So it's clearly struggling, we would say, and essentially that it's not helped To really expand the Dora class, right? And that goes back to Jean Paul's earlier comments about the PK profile of both assets in that they Have long half lives that is either going to create an adverse event challenge in some of them in the morning or you drop the dose and then you have an efficacy problem, which is what we've seen in the marketplace. We clearly have a very different profile and expect therefore to be in a very different position. In terms of COVID, I think one there's 2 ways of answering that question, I guess. One is we've clearly seen an increase in the prevalence of insomnia during COVID times. So I think If anything, COVID has brought insomnia and its prevalence into the forefront, which is no bad thing when you're about to enter that market. And then in terms of our own launch preparation, I think we're in a very good position because we're obviously building our commercial organization and our commercial model from scratch. So we're actually we don't have to repurpose an existing organization that was built for the old world, and we're certainly Very attentive to all the digital channels that Jean Paul has mentioned, the use of big data, Doing things differently and we're certainly looking to build a commercial organization that is modern And fit for the future and fit for a world where we've seen the world, frankly, transform into a much more digital place in a very, very short space of time. Yes. And for SimbaGlustat, I take the question, Andrew? Yes, please. I think for Simpaklustat, we are really just a few months close to the lucerastat. And If we Lucerastat is a very good drug, and I think If the study is positive, it will be unique. And frankly, we are a little bit hesitating. Can we Expand, for example, the labels, indications in future studies with Lucerastat? Or should we really start We've seen Paglustat, which is more powerful, which has some advantages, but which is still within the same type of drug, number 1. Number 2, you have seen some negative studies with the Sanofi drug, and we need really To analyze a little bit the differences between cibelustat and, for example, the drugs of Sanofi really in order to really take some lessons from the negative results of Sanofi. And finally, I have to say That we have some drugs coming to the to phase end of Phase 1, in Phase 2, We share fantastic potential. We are very careful on our costs. We really and I would like to say that when people think that the clinical Development costs will continue to grow, they are wrong. We really want to limit our clinical development cost in order to be also able to invest into our launches. But we most of our Phase The 3 are finishing. And I think that we as I mentioned, next year, Afrocentan, sclazotan, there is Oraxant, of course, but also luceratat will be finished. And basically, the 2 Phase III products will be SENERIMOD in a quite limited, I don't believe in a huge study, It would be scenario mode and Selatogrel, the 2 Phase III products. And we are very careful Before starting Phase II or Phase III with any other products in order to have a Very, very strict cost control. We only want to initiate Phase II and III with drugs Well, we are confident that not only they will they have a big chance of clinical success, but also they have a very large market potential. Thank you, Jean Paul. Thank you, Thibault. Okay, I think we've exhausted our time. Operator, We don't have any further questions, I'm assuming. No, there aren't any further questions. Okay. So I think we've come to the end of today's call. Thank you very much your ongoing interest in Eudorsia. I'm personally looking very forward into an engaging second half of twenty twenty or 2021, where we prepare ourselves for a market launch, Move clinical assets forward, we analyze data and we live up to our expectation and aspiration to become Europe's one of Europe's leading fully fledged biopharmaceutical companies. Operator, please close down the lines. Thank you. Ladies and gentlemen, thank you for your attendance. This call has been concluded. You may disconnect.