Welcome to the Morgan Stanley Global Healthcare Conference. I'm Jeff Hung, one of the biotech analysts. For important disclosures, please see the Morgan Stanley Research Disclosure website at www.morganstanley.com/researchdisclosures. If you have any questions, please reach out to your Morgan Stanley sales representative. For this session, we have Amicus Therapeutics with CEO Bradley Campbell. Welcome, Bradley.
Thank you, Jeff. Appreciate it. Thanks to Morgan Stanley for having us.
Definitely. For those who may not be familiar with Amicus, can you provide a brief introduction?
Sure, yeah. So Amicus, for those of you who don't know, we focus on developing next-generation therapies for patients living with rare genetic diseases, and we really have three core areas of focus for this year to drive value for our shareholders. The first is continuing to grow Galafold. That's our approved product for Fabry disease, and you might have seen that we had a great quarter last quarter, delivered $94 million in global sales, and we're able to raise our guidance for the year to 14%-18% growth. So fantastic trajectory there, and one that we continue seeing as a robust growth engine for us going forward. Second one, of course, is our Pompe therapy, AT-GAA, which is now approved in Germany and the UK under the trade name Pombiliti and Opfolda.
Two-component therapy using a next-generation enzyme replacement therapy combined with an enzyme stabilizer to treat patients living with Pompe disease. Again, launch has already started in Europe and really eager, of course, to get the FDA to give us an approval here in the Q3, which is what we expect. And then, of course, the last piece of the puzzle is our financial strength. We have, again, delivered consistent high-level growth from a revenue perspective, but this year we'll make an important milestone from a financial perspective and turn the corner to non-GAAP profitability, and then hopefully continue on our path to eventually GAAP profitability and positive free cash flow. So really exciting time for Amicus.
I feel like we're turning the page to kind of the next chapter of our evolution as a company, and glad to have a conversation with you today.
Great. Well, let's start with Galafold. As you mentioned, you raised revenue guidance to 14%-18%. Can you just talk about what factors drive the lower and the upper ends of the range?
Sure. Yeah. So, excuse me. What led us to raising the guidance in the first place was just fantastic patient demand, and what we shared at the last quarterly conference call was net new patient starts that were at levels we haven't seen since the first couple of years of launch. So really robust growth driven by demand from patients, and that was really across all of our markets. So just, you know, the truest measure of demand and performance is getting new patients on drug, and that's what drove us to be able to increase our guidance. And so kind of how does that look over the course of the year?
I would say if we continue to see those kinds of numbers, then I think you could see us, you know, maybe being at the higher end of the range of that growth range. If things look more like they do at a normal period of time, I think we'll come in kind of the middle. If for whatever reason, things, you know, cool off a little bit, you could be towards the bottom end of the range. But where we sit today, I think it'll be a really strong year for us, and look forward to that demand continuing.
Now, growth in the Fabry market is driven by diagnosis of new patients, and you've said that it is underdiagnosed. So how much more room is there, and how do you drive further uptake with Galafold in the undiagnosed, untreated population?
Yeah. So, just a few numbers to start with. Interestingly, when we launched Galafold in 2020... 2016, excuse me, in Europe first, there were about 10,000 patients who were diagnosed with Fabry globally. About half of them were treated patients. Since then, now we estimate that there are 17,000 patients who are diagnosed with Fabry disease, about 11,000 of which are treated. And so you've seen significant growth both in the diagnosed population and the treated population. The drivers of that, you know, really increase in diagnosis. First, I think there has been a growing awareness, and we've been part of this, but so have the legacy companies in Fabry, that Fabry is not just a male disease that affects it primarily the kidneys.
What we know now is that it's actually more of a later onset disease, and it affects the heart, kidneys, and CNS. And so I think that understanding has changed, so kind of what to look for. But I think there's also been a fundamental increase in the availability of genetic testing and, you know, low-cost or no-cost genetic testing available around the world. And I think that's really allowed physicians to... who suspect a genetic disease like Fabry, to confirm it very quickly. And then you have this multiplier effect, of course, within the Fabry space, because it's an X-linked disease, you see four to five family members who have diagnosed untreated Fabry disease, if you diagnose one of them.
In terms of how do you bring on the diagnosed untreated into treatment, part of it is the natural course of their disease, right? So some of them are gonna be newly diagnosed, and maybe they were diagnosed through a family member, and so they don't necessarily have symptomatology, but they will progress eventually. So I think part of it is kind of the natural evolution of disease. But I really think the other piece of it is that we've now established Galafold as standard of care in patients with amenable mutations. And so I think when patients are treated, or excuse me, presented with the choice of an every other week infusion for the rest of their life versus a safe oral therapy like Galafold, I think you're seeing a preferential choice for Galafold.
If you look at that growth to now 11,000 treated patients, we estimate globally, 1,000 of them actually were naive to treatment and are on Galafold. We've grown the market by 1,000 patients in the time that we've been on the market.
Now, you touched upon this, but one of the other growth drivers is continued penetration in existing markets.
Yes.
What kind of initiatives are you implementing for this?
Yeah, that's a big piece of it, so... And it's both sides, right? It's both switching patients as well as bringing on the diagnosed untreated. We're at about a 60% market share globally for Galafold today, which means you still have 40% of treated amenable patients to switch. So in our existing markets, there's a lot of opportunity there. So how do we do that? Part of it, interestingly, is just continued medical education. It's kind of the, you know, nuts and bolts of biotech marketing. But what we found is, even though the geneticists, of course, the treating physicians know a lot about Fabry, there's still so much opportunity to educate nephrologists, cardiologists, neurologists, who also are seeing what we call kind of a wrong track patients. So they're sitting there with a cardiomyopathy, but they actually have Fabry.
So that education is a really important part of that. A big piece of it is continued evidence generation, so we do that through publications. We've recently, in the last couple of years, published on long-term data from our own clinical studies. We're now starting to publish on a registry, which is the FollowME registry, so new data showing the long-term impact of Galafold on patients. And then there's also some really exciting stuff around trying to find new patients, and we are using AI, as a number of companies are, to help hone in on our diagnostic algorithms. And one interesting example, which kind of hits two different pieces here, we're working with a collaborator in the U.K., where they have more of a closed-loop system to find undiagnosed Fabry patients. And we actually found - this is remarkable.
We found that the vast majority of patients who are treated with Galafold, or sorry, treated with any Fabry therapy, sit in the top two deciles of the socioeconomic ladder in the U.K. We know, of course, that Fabry is not a disease of the rich, it's a disease of genetics, and so it affects everybody. And even in a system like the U.K., which is, you know, one of the much more developed and certainly knowledgeable around Fabry, you find this disparity.
So number one, it's an opportunity for us to, of course, go out there and, you know, find more patients with Fabry who could be treated, but it's also a way to start to address some of the health inequities, which I think is just a really interesting commentary on where we are with medicine, and hopefully a great opportunity to help level the playing field there.
Great. Well, let's shift to AT-GAA. What makes it an innovative approach, and how is it differentiated?
Yeah. So AT-GAA, of course, as I mentioned before, a two-component therapy, right? You have a enzyme replacement therapy, and then you have a small molecule enzyme stabilizer. On its face, one of the most obvious differentiations between our product or our therapy, I should say, and the other two existing products, is the efficacy we've seen in the Phase III clinical study. So again, just as a reminder, in the switch populations, showing benefit on six-minute walk and forced vital capacity versus standard of care. So I think that's kind of the obvious place to look. But the reality is, it's a very different mechanism, and I think that's what helps describe why we're seeing those outcomes and why they're differentiated from the other therapies.
So on the enzyme side of things, I think if you, if you look in the literature, if you look at the history of, of treatment in this space, you had an, an initial enzyme replacement therapy that unfortunately did not have optimal carbohydrates, which are... You know, these are infused therapies. The carbohydrates are responsible for uptake into the key muscle cells in particular. So we designed a product by naturally selecting a cell line that exhibited high amounts of that carbohydrate structure. That's really important because, number one, it helps address the uptake issue. But number two, what we've learned is that in order to be the most efficient, these enzymes in Pompe, GAA, needs to be processed down within the cell, within the lysosome, to a much more efficient form of GAA in order to turn over substrate.
In fact, the mature form is 10 times more efficient at chewing up substrate than the immature form. If you look at the other products that are out there, they use a very different way. The next generation product use a very different way to to address that carbohydrate mechanism, and we think is less efficient in turning over glycogen. And we've seen that in some preclinical studies that have been published. The other piece, of course, is that the small molecule stabilizer, we're the only product that brings a small molecule stabilizer to that equation. And why is that important? It's because when these enzymes live in the cell, they're protected by the pH and the nature of the cell.
When they're infused in the bloodstream, we've shown over and over again that they actually tend to lose their activity, become unstable, and become less potent. And so by adding the small molecule, you stabilize the enzyme, and you keep it in a more protected form so that more of it can be taken up into the tissue in an active form.
You mentioned the Phase III. Earlier this year, you announced long-term data from the open label extension study. Can you just remind us what you saw?
Yeah. I think the, the two important takeaways there were, number one, we saw that the, the effects were generally consistent and durable across the populations that we studied, so that's always positive. I think the second thing too, is we saw that the biomarkers also were consistent. And I think, you know, if you think about the endpoints in Pompe disease, both six-minute walk and forced vital capacity have a, an element of volition in them. And so, you know, especially when you're in an open label part of a, of a study, to be able to also see a very objective measure of biomarkers that is staying reduced over time is, I think, helps corroborate that what we're seeing on the clinical side is, is a really true effect.
Mm-hmm. You recently launched in Europe and U.K., as you mentioned. How is the launch going in those geographies relative to your expectations?
It's going really well. So remember, a couple of key things that we said we would look for in this first wave of launch. The first is trying to convert all of our existing patients, expanded access or ongoing clinical study patients to commercial product. And what we said is we would have a target of 90 days in order to be able to do that from approval to or reimbursement, I should say, to conversion in any market that we launch into. In Germany, where we were approved a few weeks ago, we have now converted all of our expanded access patients and have appointments scheduled to convert all of our clinical trial patients, and we've just started treating our first commercial switch patients. So going really well.
Then when we go and actually ask the physicians and the patients, how are they doing? How has the switch been? We're getting very positive qualitative feedback, which is really good. In the UK, where we just got approved three weeks ago, it usually takes about, sorry, 30 days to push funding from the NHS into the local centers, and that's when you can start that process of conversion that we talked about. Good news is actually that happened even faster than expected, so we just had our first commercial orders this week from a home infusion company, and we have now started to schedule switching patients, both the EAMS, which is the expanded access cohort there, as well as the clinical trial patients. So I'm confident there, too, we'll be able to switch those patients within that 90-day period.
If you think about, you know, those two cohorts, about 45 or 50 patients in the UK, 20 patients in Germany, and then you add the 45 or 50 patients in the United States who would be eligible, 100+ patients that we're confident we can convert by the end of this year to commercial drug, and then, of course, any additional commercial patients you can bring on.
And then I guess with regards to the transition of patients to commercial drug, anything that surprised you?
I would say the one thing that we were looking out for is, you know, we're the only two-component therapy, so they do have to take the small molecule. And so we were listening very carefully for whether or not that would be a burden to these patients. What we had heard ahead of time and seen in clinical studies is that, in fact, these patients are oftentimes taking kind of concomitant meds anyway, either an oral NSAID or an oral Benadryl or some other similar kind of anti-inflammatory and or antihistamine, I should say. And so it's been very easy for them to kinda just swap the small molecule into their regimen. And then the other piece, too, is just... Again, it's anecdotal, but it's, you know, you're listening very carefully.
Physicians and pharmacists have said that it's been a very easy switching process, the reconstitution. Interestingly, we have a higher unit volume of drug in our vials versus Myozyme, as an example. So it's about half the number of vials that have to be reconstituted. So that's been, I think, a net positive or incremental net positive, and then it, you know, we're hearing that patients are feeling well. So I think all of that together says that it's going really well.
And then outside of transitioning clinical trial patients, I guess it may be still a little bit early, but are the commercial patients mainly coming from other drugs, or are they newly diagnosed? Do you have a sense for how that's kind of shaping out early on?
Still a little early, but what we're seeing, so far is that it's switched patients from an existing therapy. But that makes sense, right? Because right now, we estimate there's about 4,500 total patients that are, that are treated today, and there are probably 200 or 300 or so new patients that are diagnosed every year and come onto therapy. So the vast majority of patients that we can access initially are gonna be switch patients anyway.
Mm-hmm.
So I would say if you look forward, you know, this year, the majority is more likely to be the conversion patients and then whatever additional patients we can put on drug, you know, this year. And that's really the goal. You know, we, we shouldn't expect a big revenue contribution this year, but we want to maximize the run rate going into next year. Going into next year, once most of the conversion has happened, I think then the majority of new patients are gonna be switch patients with a small number of diagnosed, untreated patients coming in.
Mm-hmm.
Or newly diagnosed.
And then you talked about anecdotal comments from physicians and patients. Can you just remind us of your efforts of KOL and patient outreach in the EU?
Yeah. So in Europe, it's very different from the United States, where you really can't communicate directly with patients. You can communicate with patient advocacy organizations through their scientific advisory boards, et cetera. But I think in Europe, and everywhere, frankly, I think there's a pretty high awareness of this medicine in the patient community, but that's really has to be an organic effort. It's not something that we can do directly. With physicians, the good news is, in both U.K. and Germany, we're able to see the top prescribers within the first 30 days. So and a number of them have already had experience with AT-GAA.
So in the UK, all six of the treating centers were already either EAMS, which is the expanded access mechanism or clinical trial sites, so we had relationships with all of them. In Germany, it's a little bit more like the US, so there's probably, I don't know, 20 or 30 KOLs, top treating centers, and then maybe 100 or so additional infusion centers that are more disparate, and we're able to get in front of those top treaters very quickly and now working our way through the other ones. So the outreach effort has been strong and consistent and very good so far. We also have some key conferences. SSIEM actually just happened in Israel, and a number of European doctors go there, so that's a key platform for all of our data presentations.
We had our publication already in Lancet Neurology for the Phase III data, so that's out there. You'll look to see us continue to publish on both long-term extension data, but also preclinical data on some of the things I mentioned in terms of the mechanism, and all of those are ways to engage physicians.
You touched upon this, but maybe if you can clarify or reiterate again, just for the switch patients, what data points or messaging resonates most with patients and physicians?
Yeah, I do think it's that three-tiered messaging. The first is, and this is the most important piece, which is we are the only company that studied head-to-head in an experienced population, what happens when you take a patient off of an existing therapy and put them onto our medicine? And that's where we showed in that population, those clear benefits in six-minute walk and forced vital capacity. I think that, for sure, is the leading message with physicians. But you also then back that up with a very consistent story that the biomarkers tell, right? Hex4, CK, ALT, AST, those kinds of biomarkers, which I think are more objective measures. And then I do think that mechanistic difference will be really important.
I think as we go out there and try to differentiate ourselves from both the first-generation therapy, Myozyme, as well as the new one, Nexviazyme, being able to tell the why of it will also be important, and we hope to continue to elucidate that through publications and posters and presentations at conferences.
Great. Now, U.S. approval is expected imminently.
Yeah.
Can you just talk about the commercial launch preparation activities and how you're planning to target?
Yeah
- patients?
Yeah. So, really excited. As soon as the FDA give us the green light, we are ready to go. A couple things that we have done proactively. The first is we've actually brought product over, and it's sitting in what's called a free trade zone. So even though it's unlicensed product, we have our supply, our initial launch supply sitting in a warehouse in a free trade zone, so that's ready to be labeled and then sent out to the specialty pharmacies and distributors. We actually had our last launch training meeting at the end of July, so the sales force is fully trained on the label, on the competitive positioning, and all those elements. Excuse me. Likewise, the medical affairs team is part of that process as well.
We did add to our hub, so our patient services hub, we added a handful of case managers. They're hired and trained and ready to go. And then likewise, we, we added to our field force. In the United States, you can do this, a handful of patient education liaisons who are meant to help, when patients are on therapy, help them sort of manage the logistics of the therapy. So all of those pieces are in place, and... You know, maybe the biggest differentiator, between being kind of launch-ready and where we were with Galafold is just the experience of the team. You know, this team has been in place, since 2018, when we launched Galafold in the U.S.
Market access, medical affairs, sales, leadership, marketing, and it's just a really experienced, passionate team, and even though Galafold continues to grow and will continue to be a core part of the business, you know, having that experienced team ready to launch AT-GAA is just really exciting, and we're very excited for the starting gun to go.
Any learnings from the launch in Europe or UK that your team can apply to the US launch?
Yeah. So part of it, I think, is that, the conversion process. So expanded access is a little bit easier in the sense that they don't-- there's no, they don't have to do any kind of end-of-study activities, whereas in Europe, Sorry, any existing clinical trial patient, they have to do an end-of-study visit. So kind of how to pass the baton in the right way, making sure that you have, clinical product all the way until the switch, and then you have commercial product ready to go, working with physicians on how to schedule those handovers. So I think that's been an important part of the process, and as I said, it's gone really well. So I think we can take those learnings on how to do that in a way that supports physicians and patients, but also moves quickly.
I think, too, what I mentioned earlier in terms of the ease of transition, what we found with Galafold, where we were launched in Europe, you know, two years ahead of when we launched Galafold in the United States, we were able to work with a number, in particular, the nurses, who were the ones kind of on the front lines, on what was the experience like switching from ERT to a small molecule? What should I expect? Are there any side effects? And then we took those nurses and had them speak at various conferences and symposia to help educate the, you know, the newcomers to the switch process. So I think taking some of those learnings from just how to easily switch them will be important as well.
Okay, great. Maybe moving on to the pipeline, like among your earlier stage pipeline candidates, what excites you the most?
It's like asking me to pick a favorite child. I don't know how to do that. So no, in all seriousness, yes, we have we do have a pipeline. We have, judiciously invested in continuing that pipeline going, and that's in the context of our profitability target for the back half of this year, but we are continuing to work on that. As a reminder, we've got our Fabry gene therapy, our Pompe gene therapy, and then our next generation, chaperone. In the case of the two gene therapies, we have, and we've said this, you know, as we kind of wound down the rest of our non-Pompe/Fabry gene therapy programs.
We think that there are some real challenges in AAV delivery of a systemic gene therapy, especially in Fabry and Pompe, and I don't wanna speak to other people's technologies, but from our perspective, I don't know for sure that we're ever gonna find a way to use AAV to deliver those medicines. We do believe our transgenes are very differentiated, the proteins that we're delivering, and we think those have real utility. But I would say right now, we're looking, number one, to confirm that suspicion that AAV may or may not be the right vehicle, but number two, look for potentially other, other vehicles to deliver those transgenes. I think you, you'll see us start to talk more about that as we answer some of those questions. So hopefully into next year, we can talk a little bit more about where we are there.
And then with the chaperone, also very excited, super early still, but the goal there would be to find a chaperone that increases the number of mutations that we can target. There are a number of mutations that we saw that were, like, borderline amenable, but didn't quite meet the criteria. So could you expand the population? Then, of course, any benefit you could give over Galafold in the existing patient population. But again, it's early. We're still looking for our final candidate selection. So I do think that will be an important part of the story going forward. Amicus is dedicated to being leaders in the Fabry and Pompe space. I hope that one of those programs will be, you know, one or many of them will be able to get into the clinic.
You can see us continuing to be leaders in that space, and hopefully, over the course of next year, we'll have more to say on our internal pipeline.
You've been saying that you're on track to achieve profitability this half. Like, so how do you think about the importance of that relative to accelerating earlier-stage programs?
Yeah, I really believe right now we're sort of turning the chapter kind of to the next phase of our growth from an Amicus perspective, which I think means continuing to be disciplined on the profitability target. So what you should expect to see us do with our pipeline is only invest in the pipeline with whatever dollars are remaining after we deliver on our financial goals. And so this year, non-GAAP profitability, we'll talk more about and tighten this up, but you could see that stepping its way through GAAP profitability and then positive free cash flow or EBITDA or whatever, you know, measure of profit you want to look at. But we will continue to invest.
And then as the portion of R&D Opex that's going towards the ongoing clinical extension studies to our post-marketing commitments, as that kind of continues to hone down on Fabry and Pompe, we'll fill that in with investment in, in the pipeline.
Great. Maybe one last question then. Can you just remind us how much cash you have and the runway that gets you?
Yeah. So, $266 million at the end of last quarter, Q2. We don't think about it as much as, you know, from a runway perspective anymore. What we've said is that, you know, our goal is to get to self-sustainability. In order to do that, what we've said is we put an ATM in place at the end of last year, and you saw that we had been kind of judiciously using that over the last couple of quarters just to maintain a healthy operating cash balance. But we have enough cash and enough revenue to fund our operations for the foreseeable future, with no intent to pursue other avenues to raise capital.
Great. Looks like we'll have to leave there.
Great.
Thanks so much for your time.
Thank you very much.