Hey, good morning, everyone, and welcome. My name's Jessica Fye. I'm a biotech analyst at J.P. Morgan, and we're continuing the healthcare conference this morning with BioMarin. We're going to start out with a presentation from the management team, including the company's CEO, Alexander Hardy, and then we're going to go into some Q&A afterwards. There's a portal you can submit questions to through the iPad or raise your hand in the room. Somebody will probably bring you a mic. But with that, let me pass it over to BioMarin CEO, Alexander Hardy.
Thank you very much, Jess. Good morning, everybody. Thank you very much for joining us. I'm Alexander Hardy, President and CEO of BioMarin. We're going to be making forward-looking statements and also talking about non-GAAP financial information. So please refer to these disclaimers and the reconciliation information included in the presentation, which is also available on our website. So I've been in the role for 13 months now, 12 months since I presented for the first time at the J.P. Morgan conference, and it's been a very busy 13 months. We've revamped the strategy. We've made important decisions about the structure of the company, our operating model, important decisions about our portfolio and our pipeline. We've strengthened our leadership team. That's a lot of changes, but what has not changed is our focus on being the leader in genetically defined conditions.
This is what really sets BioMarin apart, is our capabilities and our track record in this area. We identify the root cause, we go after it, and we create category-defining medications with our excellence in research and development. Our ability to manufacture is really excellent, and then we have this capability and this footprint in over 80 countries around the world that allows us to bring these amazing medicines to the patients that need them across the world, and this also translates to a very vibrant, resilient, and strongly growing company, and now increasingly profitable, and this is why I think BioMarin is one of the most exciting stories in biotech right now. The decisions we've made with regard to strategy and operations are already starting to play through in terms of our financial performance.
We've had strong financial performance through the first reported three quarters of 2024, exceeding overall guidance in each of those quarters. Through the third quarter year to date, we've had revenue growing strongly. We've had increasing levels of profitability and earnings per share on a non-GAAP basis growing much stronger than revenue. But we've been producing these results at the same time as setting a new direction, a new exciting direction for BioMarin, and a key part of that is our strategy and our strategy is based around three pillars: innovation, growth, and value commitment. Innovation, of course, fundamentally this company is about discovering these genetically defined medicines for these genetically defined conditions, and that will remain absolutely at the heart of everything that BioMarin does, but we also have a very exciting growth strategy. This is largely about further growth for already approved medications.
Obviously achondroplasia for Voxogo, but then five subsequent indications that we're developing, all of these in the last year, have moved into the clinic. But also important advances in other parts of our portfolio, and our pipeline is also advancing well. And all of this allows us to make some significant value commitments of revenue growth and profitability and cash generation for the years to come. Last year, one of the things we did was to prioritize our pipeline, make sure that our pipeline included only the most significant advances with the greatest potential to make a difference for patients in the future. And we're already starting to see the benefits of that in terms of our pipeline. We now have a pipeline of really exciting medicines that are poised to make a big difference, we believe.
And we've got a number of really important milestones over the next 18 months. We've got those five subsequent indications for Voxogo moving ahead, as I mentioned. We've also got advances in our pipeline with regard to enzyme therapies. With Palynziq, we have the readout of a phase three study that hopefully will allow us to expand Palynziq into the 12-17 age group in both the U.S. and Europe. And we also have important milestones happening with new molecular entities in our pipeline over the next 18 months. And Greg Friberg, in a moment, will share some of those.
And then also what is going to be important under the leadership of James Sabry, that you'll also hear from in a moment, leading our business development, is business development is poised to play a very significant front and center role in further augmenting the growth outlook for BioMarin over this next period. So all of these together allow us to communicate guidance over the long term of really a compelling picture of $4 billion in revenue in 2027, profitability of 40% operating margin in 2026 and increasing thereafter, significant cash generation. And then longer term, we believe that we've got the path to significant continued high levels of growth, and we're targeting mid-teen CAGR revenue growth through 2034. And as part of this is the $5 billion peak potential that we believe the skeletal conditions represent.
So it's a really exciting picture that all of these things lead towards is allowing us to make these very long-term exciting projections for BioMarin. So let's just talk a little bit about that growth strategy. And a key part of this is achondroplasia and Voxogo's potential in achondroplasia. And while this has been a very successful launch to date, we have a lot of growth ahead of us. We're currently approved in about 40 countries around the world. And if you think that the BioMarin footprint globally is around 80 countries, we still have room to grow. And over the next several years, between now and 2027, we'll be adding approximately another 20 countries to our global footprint. Now, this pie chart represents the total addressable patient population for achondroplasia around the world. You see the orange part of the pie represents 22% of that total patient potential.
This is in the highly penetrated markets. This is Europe. This is Australia, Canada, Japan, among the most significant countries in that pie. We're already highly penetrated. We aim to continue that penetration and grow in many of the remaining markets in that segment, but very importantly, you see the purple part of the pie, the rest of the world segment, represents 68% of the total achondroplasia patient potential. This is really excellent for us because this is what we're set up to do with our footprint in 80 countries. Now, Voxogo is available in many of these markets, but we have a lot of room to further penetrate. We've been very successful in countries like Brazil. We're aiming to do that in many, many more countries, and then finally, you see that the largest single market, of course, is the United States, represents 10% of our patient potential.
There, we're growing extremely well. The next slide, let's talk a little bit about that growth outlook in the United States. Now, between now and 2027, our financial forecast, we do take into account that we may have competitors in that timeframe. However, we believe that Voxogo is very well positioned to maintain its leadership position. The reason for that is really five important factors. First and foremost, Voxogo has a compliance rate of around 95%, which really speaks to the excellent patient and caregiver experience that Voxogo provides. Secondly, we will have approximately a five-year lead over any potential competitor. Thirdly, we have a broad U.S. label all the way from birth. Fourthly, 6,000 patient years of safety and efficacy data. And that's obviously, as of this point, by 2027, there'll be many, many more thousands of patients, years of experience.
And then lastly, I think very significantly, is the growing level of evidence, body of evidence we have of Voxogo's effect beyond growth. This is extremely important to caregivers and HCPs and the decision to treat in achondroplasia. And Voxogo, by the very nature of its being on the market for longer and our really excellent profile, we're producing that evidence. And that's going to be really important. And this is why we believe that patients, caregivers, and HCPs will continue to put patients on Voxogo. And for patients that are doing well on Voxogo, the vast majority, we believe, will stay on Voxogo going forward. Now, data is very, very important in this space, and this is really exciting.
In the last couple of months, we've had two new, really important pieces of data and evidence, which are both important in terms of the growth in achondroplasia and that outlook over the next several years, but also really important in terms of our competitive differentiation going forward. The first on the left is published in December in Med, and this is around proportionality, and again, caregivers and HCPs, the evidence beyond height is really extremely important. It's important to note that proportionality increases in all children, untreated children, as they grow. So to really be able to elucidate the benefit in proportionality, you need to have an untreated control group in your study, and this is what this evidence on the left is. This is three-year data for Voxogo, showing that there was a statistically significant improvement in proportionality versus an untreated control group matched on an age basis.
We are the only drug, either available or in development for achondroplasia, that has statistically significant impact on proportionality versus an untreated placebo-controlled population. This is a really important piece of evidence. On the right-hand side, this is very important in terms of the continued growth and penetration of Voxogo in achondroplasia. These guidelines, these were actually published this month. These were produced by 16 independent physicians. They speak to the importance of early screening, early diagnosis, and specifically starting Voxogo as soon as possible after that diagnosis so patients can get the maximum benefit from the treatment with Voxogo. I think these represent really good examples of how Voxogo's leadership is going to translate to continued growth, but also should and if competitors come, why Voxogo will sustain its leadership position.
Now, the second indication we're aiming for Voxogo is hypochondroplasia, and we're making really excellent progress with this indication. We're recruiting extremely fast. Greg will touch on this in his words. We're making very strong progress here, I think, because the phase two results were really compelling. They allowed us to go straight to a registrational study. And this is also driving, I believe, the very fast levels of recruitment that mean that we're on track to get approval and launch in 2027. Now, in terms of our go-to-market strategy, this is exactly what BioMarin does so well. We're creating disease awareness. We're increasing, we're working on increasing those diagnosis rates. And of course, this is very much an overlapping prescriber base with the achondroplasia treating population.
In summary, we're in a really strong position with regard to building and sustaining our leadership position with Voxogo in skeletal conditions. We're expanding geographically, as I already covered. By 2027, we'll be in more than 60 countries with Voxogo. Secondly, we're making really good progress with our clinical program, where we focused and accelerated those five subsequent indications, but also BMN 333, which is our long-acting CNP. We're making excellent progress. I'm really pleased today to announce that we've initiated the first in-human study of BMN 333. Finally, as part of our leadership approach position in skeletal conditions is our strong intellectual property. We said that we would defend our intellectual property, all the hard work that we've put in elucidating the benefits of CNP in these really important conditions.
Today we announced in a press release that was issued shortly that we've initiated an action against Ascendis in the Unified Patent Court in Germany. So over the next 12-15 months, we will see what the court decides in 18 EU countries. This, of course, builds upon the upholding of our patents by the European Patent Office last summer. Now, moving on to the enzyme therapies business, this is a very, very important part of our future. I think this is underappreciated by investors. It's resilient, it's durable, but it's also growing. The resilience is because these are very complex biologics. They're hard to manufacture. It also plays the importance of that global footprint. You need to be operating in 80 countries around the world to be able to maximize the potential of this portfolio.
But we see there's even an opportunity for us to grow this portfolio even faster with better patient identification, earlier diagnosis, and improved adherence. So important to note, this portfolio has been growing very fast over the last several years. So over the last three years, the annual growth rate has been 8%. What we're aiming to do is to get a target growth rate for this portfolio of high single digits. And you'll see on the right-hand side various of the strategies we're going to employ for our enzyme therapy business to improve patient identification and diagnosis rates in many of those markets in that 80-country footprint. But it's worth taking a moment just to highlight Palynziq for a moment because that's got a very significant growth potential. I've already mentioned the adolescent indication, which should expand the total addressable patient population by about 10%.
But we really believe also in the Palynziq profile. So this works across all the PKU phenotypes with very significant levels of efficacy, including the potential of diet liberalization, which is extremely important patient benefit. So we're confident that no matter the competitive entries that we see right now, that Palynziq has a very strong profile ahead. Now, I mentioned the importance of external innovation. This is very exciting under James Sabry's leadership that this will be an important part of our growth strategy going forward to augment our already exciting growth profile. We believe the environment is very well suited for us to be able to identify deals.
We believe that our position as a leader in genetically defined conditions and our capabilities and our global footprint will allow us to do deals that are the right deals for BioMarin, but also the right deals to add value to shareholders for the long run. So James will be available for questions and answers on this very, very important point. At this point, I'd like to hand over to Greg Friberg. Just by way of introduction, Greg joined us at the end of September after 18 years or so at Amgen, where he was responsible for the development all the way through from early clinical NDA programs all the way through to late-stage programs, and he's moved into the Chief of R&D role at BioMarin in a seamless fashion. He's really doing a phenomenal job. He's responsible for all of research and development.
That is research, early clinical development, late clinical development, global regulatory affairs, and medical affairs. Greg, over to you.
Thank you, Alexander. It's a real privilege to be here today and represent the dedicated R&D colleagues at BioMarin. I want to focus a little bit on two programs that are in our pipeline, which have some upcoming milestones. Then finally, I'll wrap up with a quick overview of additional milestones. The first is BMN 333. This, of course, as Alexander alluded to, is our half-life prolonged CNP analog. It uses technology that's currently used in other approved drugs. And this should afford a weekly dosing paradigm. But beyond just the convenience, this molecule is engineered in order to try to increase the free CNP exposure that we can reach in patients. What sort of level? We're talking about multifold levels of increase.
And what I mean by this is illustrated in the right upper-hand quadrant here. This is cynomolgus monkey PK data that's shown. And you see it's blackish-purple in the top. You see, again, a weekly dosed BMN 333 molecule. But what you also see is that this reservoir, if you will, holding CNP bound in the inactive state slowly releases that CNP into the system. And in blue, you see the resulting free CNP species. Of course, there's a nice wave-like function here. You don't see the sawtooth pattern that often is seen with shorter half-life, more frequent administrations. And that shape affords two qualities that we're hoping to test in the clinic fairly rapidly. One of those is that the Cmax of this molecule avoids by about a tenfold margin the levels where we can run into some toxicities.
But it also, you can see after several doses, reaches sustained levels of about 100 picomolar or higher. And when you compare apples to apples across other cyno PK models, this is where we get about a two- to threefold increase compared to what's been published with other long-acting CNP molecules. And that's a conservative estimate. Similarly, you're probably asking the question, "Okay, well, there can be more free CNP exposure, but what is the importance of that to patients?" And below the upper right-hand quadrant, you see a separate model. Now, this is in mice, a different species. But what you see here is that these mice, when they're dosed either with a vehicle or a fairly healthy dose of vosoritide, Voxogo, or BMN 333, you see gradually increasing total body length. So the message here is there is more meat on the bone.
It appears that increasing exposure beyond what we can see with Voxogo, with vosoritide dosed here, does result in more pharmacodynamics, and that's exactly what we're hoping that this molecule will be. This molecule, as Alexander points out, is currently in phase one testing. The FDA cleared our IND at the end of last year in the fourth quarter, and so this study is currently enrolling. Similarly, we're hoping that by the end of the year in-house, we're going to have the full PK profile from this molecule. That will allow us, again, to test not just the BMN 333 levels, but the free species as noted below. We are on target, should all things play out, for a launch in achondroplasia in the 2030 timeframe, and of course, we're working on a variety of levers to try to accelerate that wherever possible.
We hope that, again, this PK data that we'll have in-house by the end of the year will be something that we'll be able to present publicly at a scientific congress in the first half of next year. The second molecule I want to highlight briefly for you is BMN 351. We're pivoting into Duchenne muscular dystrophy. In particular, these are the patients that are exon 51 skip amenable, and this molecule is an oligonucleotide therapy. There are three factors that we've engineered into this molecule that I want to highlight for you that give us confidence that this will at least look different than molecules that have been tested previously. The first of those is that this targets a novel splice site for exon 51 skip induction. In the animal species, we see 30%, 40%, 50% dystrophin levels.
That gives us the confidence that we can target in humans to try to reach greater than 10% levels at steady state. Why 10%? 10% in patients is a level at which we start seeing different phenotypes. You see more like the Becker muscular dystrophies rather than patients losing ambulation in their early teenage years and, of course, succumbing to their disease not long thereafter. Patients live well into their 40s and 50s and beyond. This isn't just a story of quantity of dystrophin. This is also about quality of dystrophin. This molecule in particular should produce near full-length dystrophin. It's not a micro-species.
We know from looking at some genetic data that actually this particular splice variant, if you look at this near full-length, you can ask the question, "How do these patients do in the real world?" There are folks walking around with this gene product. And that's what you see in the figure there right below the heading. You see that patients in blue with this near full-length dystrophin actually maintain ambulation well into their 50s and 60s, as opposed to, again, what we know to be the tragic case in boys with Duchenne muscular dystrophy. Finally, a third factor of this molecule with regard to the chemistry is that this is a non-morpholino compound. This is a phosphorothioate.
The implications of that are that we're hoping that there will be a therapeutic window, a benefit-risk argument that will look different than some of the other high dystrophin-producing molecules that have been brought into the clinic thus far. It's early days, but we have a lot of confidence, certainly in the preclinical data that we've seen. You see in the upper right-hand corner that we've published quite a bit of the preclinical data to support this molecule. This is currently in phase one testing. Six boys have been treated at the six milligram per kilogram dose level. We are eagerly awaiting the data of the 26-week muscle biopsy that will be available later in this half of the year. We're hoping to publish that data in the second half of the year at a scientific congress.
We also are eagerly awaiting that 26-week data because we have some data in-house. Now, it's very early, but we have two patients with muscle biopsies at 13 weeks. And again, steady state is actually out close to a year or farther. So this is a very early time point, very small numbers. But from that data, we've been able to determine that indeed we can penetrate the muscle. So we're seeing PK there. We can induce skip induction. We see the gene product. And we are seeing measurable levels of functional dystrophin. And so, again, eagerly awaiting the 26-week data. Second half of the year is where we anticipate releasing that at a public scientific discussion. Finally, I want to wrap up by just highlighting some milestones. Alexander has noted several here.
In addition to the pipeline, of course, we have some market-facing molecules with really important cards to turn over. In phenylketonuria, we talked about the adolescents, but the one I want to highlight in addition for you is hypochondroplasia. We have identified the patients who will be needed to complete our enrollment of the dosing cohort in the first half of this year, and again, several months ahead of schedule of where we had anticipated, and so again making very good progress there, so thank you for your time. I'm going to hand it back to Alexander, and then I believe we're going to take your questions.
Thanks, Greg. Well, I think you can see the enormous amount of progress we've made over the last 12 months. We're executing an exciting, bold new strategy with a restructured and invigorated organization and with a strong new leadership team.
So we're very excited about what the future holds. We believe that the future of BioMarin is very, very bright. We're poised to make even more difference for patients going forward. And that bright future is for patients, for our employees, and we believe for our shareholders. And with that, I'd like to invite up for question and answer to join Greg and myself, Cristin Hubbard, who is our Chief Commercial Officer, Brian Mueller, Chief Financial Officer, and James Sabry, our Chief Business Officer. Please come and join us.
Great. And maybe while the rest of the team is coming up here, I can just start with the first question. We're getting a bunch of investor questions on the back of the litigation that you just announced. Can you outline the potential outcomes that could result from that litigation in Europe against Ascendis?
I think a lot of investors view this as sort of a best-case scenario as royalties to BioMarin versus actually blocking them. But is that accurate?
We will be seeking an injunction preventing the launch and commercialization of TransCon CNP in those 18 European countries. And once again, by initiating this action at the UPC, Unified Patent Court in Germany right now, we expect that decision within 12-15 months. So that's important in terms of that timing.
Got it. Maybe a question for Greg, and thank you for the presentation on the pipeline. Can you expand a little bit on the non-human primate data for BMN 333 and how that compares to other long-acting CNP products? What levers do you have to accelerate development there? For example, could you go straight from this phase one to a pivotal trial? And then I just want to clarify.
I think you mentioned PK data at a conference in the first half of 2026, but you get the data by the end of 2025. When do we get the data?
Yeah. So lots of questions there. With regard to the PK data that I showed, indeed, that was cynomolgus monkey data. And that 100 picomolar level, those sustained levels, that's where this comment of two to threefold higher than what's been published from other long-acting agents. That's probably a conservative estimate, given some differences between species. But that's certainly one of the areas and data points that gives us confidence. With regard to the potential pivotal studies for the program, once we have the PK data in hand, we will be moving into patients. And there'll be an opportunity, of course, to not only do dose ranging, but potentially begin a pivotal study.
And we're, of course, working on a variety of levers to see how can we speed that up. Voxogo, again, was the first-in-class molecule. It took about 10 years from first patient to approval. Right now, we're targeting and feel very confident that we could reach in achondroplasia and an approvable package for the 2030 time range. But there's a variety of levers we're using to try to accelerate that. First and foremost, study design elements. And this is what you were getting at. We can't make those alone. We have to work with regulators. But we're obviously looking for opportunities to use adaptive designs, borrowing all of those things to make that recruitment process faster. Secondly would be actually the patient recruitment. And of course, we'll look not only geographically, but at sites to make sure that we can reach patients as quickly as possible.
And the third factor we'll be looking to use would be what I call operational efficiencies, regulatory reviews, chances to decrease white space in between any of those decision-making. So we will have that PK data in-house, hopefully by the end of the year. We're hoping to present at a scientific congress in the first half of next year. There potentially may be opportunities to share information sooner, but we're going to want to take it one step at a time. And what we're committed to is a scientific presentation in the first half of next year.
Maybe one for James, and I'll kind of keep it open-ended here. What kind of business development deals do you want to do?
Well, there's a lot of opportunity for BioMarin at this stage.
The company has a strong financial basis, as you've heard about and Brian can expand about, but you heard about from Alexander. That combined with the R&D group that Greg leads really gives us an opportunity to extend our innovation not only with the internal programs that we have, but externally as well. We're interested in deals that will be a platform extension of what we're working on, Jess. There are many companies, both private and public, that are in the rare disease or building medicines for genetically defined populations. Many of these are looking to us as a partner of choice for commercialization, manufacturing, and further late-stage development. Our focus will be on clinical stage deals, but we'll also do some research stage deals. We're interested in deals that are focused in the business units that you've heard about.
There are a number of possibilities. We have a very busy J.P. Morgan in front of us on the BD side. We think there's some real opportunity here over the next 12 months to do many deals.
Great. Maybe one for Cristin. Thinking about the real world, how are Voxogo's new treatment guidelines going to impact awareness and uptake?
Yeah. As Alexander nicely presented, we're really excited about these new international consensus guidelines that were created by 16 experts across the world. At the end of the day, we know how important medical guidelines are, in particular for new treatments like Voxogo in therapeutic areas that were previously untreated.
And so we're very excited that the push for early screening, so this detection of achondroplasia can happen as early and as prenatal, but all the way through to six months of age, and the importance that it states around treating with Voxogo as early as possible so that we can maximize the clinical benefit for these patients, certainly not only in height, but importantly in their overall health, is where we see the data certainly evolving. So we are encouraged by the fact that both building that awareness and, importantly, the confidence to treat with Voxogo as early as possible will help us with uptake.
Let's see. Maybe Alexander next. You started out the presentation by saying it's your 13-month anniversary at BioMarin.
Of all the decisions you've made over the past year or so, what do you think is going to have the most impact on BioMarin's growth strategy or trajectory?
Oh, that's very, very hard to say, Jess. I think they all build upon each other. But if you're pushing me to say one, I would say the strategy itself and these three pillars allow the focus of the company towards what's most important in terms of driving, realizing that increased potential. So that's probably the thing I would say the most important. Of course, one of the first things I did and worked at over the course of this year is really assembling an incredible leadership team.
And I think that is extremely important, both in terms of our execution, but also shaping the culture in the right direction and making BioMarin an even more amazing place for employees to work.
Maybe one for Brian. As the company becomes increasingly profitable, growing cash, how should we think about deployable cash over the coming years?
Yeah. Thanks, Jess, for the question. It's been very exciting over the last several quarters to talk about BioMarin's revenue and profitability growth, margin expansion, both in terms of our actual financial results through the third quarter of last year and then, as outlined in our long-term guidance. However, to your question, the most meaningful tangible product of that profitability is cash flow. And I think this is still underappreciated in terms of our ongoing quarter-to-quarter results as well as the long-term guidance.
As BioMarin starts to generate growing cash flow and accumulate cash, we should have ample opportunity to execute upon our top capital allocation priority of investing in future growth. We finished Q3 2024 with $1.5 billion of total cash investments, and that's after paying down a $500 million convertible note in August. So over time, our strategy is to deploy cash to generate both long-term revenue growth and shareholder value. And maybe one last thing I'll add is our positive and growing EBITDA profile will, in addition to the cash we're accumulating, that will also allow us to access non-dilutive traditional debt financing, whether it be leveraged bank loans, public loans. So that'll be another tool over time.
Maybe coming back to the pipeline on DMD, you kind of gave us the teaser talking about these two patients with measurable levels of functional dystrophin.
Anything you can quantify about those measurable levels? Any more to share there?
Yeah. We're going to wait till we have a reasonable number of patients, the four patients, before we start talking about quantitative data. But certainly, from a negative predictive value, we've wiped off the table some potential challenges. We know that the molecule is getting where we want it to be into the muscle. Again, early days, 13 weeks. We know that we can see pharmacodynamics and see the protein being produced. I often tell my colleagues it's a bit like predicting the weather. And when you're too far away from the actual event, you don't want to get caught up in the quantification. So from a qualitative standpoint, we're feeling quite confident.
But the data that we'll have in hand for public presentation in the second half of this year, that is the data that we think will be meaningful and will give us a line of sight whether that 10% and above dystrophin level is going to be something that we can reach with this molecule. I should also add that the DMC for the study has approved going up a dose level. So we're starting to enroll at a nine milligram per kilogram cohort. And we'll continue to run the study, hoping that we can help these boys with truly terrible illness.
Great. With that, we are about out of time. So we'll leave it there. Thank you.
Thank you very much.
Thanks, Jess.