Ladies and gentlemen, welcome to the conference call of MorphoSys and Incyte. Please note that for the duration of the opening statements, all participants will be in a listen-only mode, and the conference is being recorded. Thereafter, there will be the opportunity to ask questions. Please note that we can only take your questions if you have registered by name. Should anyone need assistance during the conference call, they may signal this by pressing star and zero on their telephone. Now I would like to turn the conference over to Sarah Fakih. Please go ahead.
Thank you. Good morning, good afternoon, and welcome to our joint conference call and webcast to discuss the announcement of our global partnership deal with Incyte, which was signed yesterday evening, Pacific Time. My name is Sarah Fakih, and I'm the head of corporate communications and investor relations at MorphoSys. With me on the call today are Jean-Paul Kress, our Chief Executive Officer, and Jens Holstein, our Chief Financial Officer. We are very pleased to be joined by Hervé Hoppenot, the CEO of Incyte, Christiana Stamoulis, Incyte CFO, and Michael Booth, Incyte head of investor relations. Before we start, I would like to remind you that during this conference call, we may discuss certain forward-looking statements, including those concerning the development of MorphoSys' core technologies, the progress of MorphoSys' current research and development programs, and the initiation of additional programs by MorphoSys.
Such forward-looking statements may also include Incyte's expectations for 2020 and beyond, the commercialization of Incyte's products, Incyte's development plans for the compounds in its pipeline, as well as the development plans for Incyte's collaboration partners and the potential future for product launches by Incyte. Should actual results differ from the company's assumption, ensuing actions may differ from those anticipated. You're therefore cautioned not to place undue reliance on such forward-looking statements, which speak only as of the date hereof. We also encourage you to review the risks and uncertainties described in our SEC and other regulatory disclosures, including Incyte's 10-Q for quarter ended September 30, 2019. In today's call, both Jean-Paul and Hervé will make brief opening statements describing the partnership and its rationale, and then we'll open the line for your questions.
Given the time constraints and our need to close the call at 7:45 A.M. local time here in San Francisco, I ask that you limit yourself to one single question to allow as many to ask questions as time allows. I will now hand over to Jean-Paul.
Thank you, Sarah, and thank you all for joining the call. Yesterday evening, we announced a global collaboration and license agreement with Incyte for our key asset, tafasitamab, which includes U.S. co-commercialization. Let me briefly remind you about tafasitamab. Tafasitamab is our proprietary investigational Fc-enhanced antibody against CD19. We submitted a BLA for tafasitamab in combination with lenalidomide to the FDA in December last year for the treatment of relapsed or refractory diffuse large B-cell lymphoma. Subject to FDA approval, we plan for a U.S. launch mid-2020. In Europe, we plan to submit a marketing authorization application to EMA in R/R DLBCL by mid-2020, allowing for an earliest potential approval by mid-2021. With Incyte, we have a strong and highly dedicated partner to work to maximize the value and broaden the opportunities for tafasitamab as a potentially new foundational therapy across B-cell malignancies.
Incyte has a strong footprint in hematology in the U.S. and in Europe and will ensure the right focus and effort on the launch of tafasitamab. The press release describes the key details of the transaction, including the disclosed financial terms. I will not repeat all that detail here. The agreement outlines that MorphoSys and Incyte will co-commercialize tafasitamab in the U.S., where MorphoSys will lead the commercialization strategy as well as book all revenue from sales. MorphoSys and Incyte will share profits and losses on a 50/50 basis. Outside the United States, Incyte will have exclusive commercialization rights and book all revenue from sales of tafasitamab, paying MorphoSys tiered royalties on ex-U.S. net sales. Upon closing, MorphoSys will receive an upfront payment of $750 million. In addition, Incyte will make an equity investment into the company of $150 million.
Furthermore, MorphoSys will be eligible to receive future milestone payments amounting up to $1.1 billion. Importantly, we believe that the partnership with Incyte allows for the highest mutual value creation. This is a partnership based on the combination of a promising candidate for MorphoSys' strong antibody development expertise with Incyte's established hematology oncology footprint on both sides of the Atlantic and their proven ability to develop and provide patient success to important new medicines. I will pass on to Hervé. Hervé, please.
Thank you, Jean-Paul. First, I must say we are very excited by the prospect of tafasitamab, and we work with MorphoSys to ensure we can deliver on its full potential. We see CD19 as a unique mechanism of action that is fundamental to the treatment of B-cell malignancies. While there is a near-term opportunity in the launch in DLBCL, there is significant upside in the medium to longer term. We believe that tafasitamab can become a very important part of our oncology portfolio. Both companies will work together as we seek to broaden tafasitamab development beyond DLBCL into other B-cell malignancies such as follicular lymphoma and CLL, including combination with parsaclisib, our PI3 kinase delta inhibitor. We expect tafasitamab to significantly enhance both top line and bottom line growth in 2025 and beyond.
With the BLA already submitted and the MAA expected mid this year, upon approval, tafasitamab may also contribute to near-term revenue growth. Tafasitamab also fits very well with our current commercial hematology footprint, and therefore enable us to capitalize on significant commercial synergies in the U.S. and in Europe. In the U.S., we have proven success over seven years with Jakafi in hematology with the same customer base treating DLBCL. In Europe, in the past four years, we have built a strong capabilities in hematology with commercial teams and a very strong medical network with ongoing studies in hematology and in non-Hodgkin lymphoma. We will deploy these resources to support tafasitamab. Lastly, we are looking forward to working with the MorphoSys team as both companies are highly innovative and agile in decision-making.
We now have the opportunity to accelerate tafasitamab development into global markets and to develop it in multiple indications as we work to improve the lives of patients suffering from serious and life-threatening diseases. Let's now open the lines for your questions.
Ladies and gentlemen, we will now begin the question and answer session. If you would like to ask a question, please press 01 on your telephone keypad now. You will be advised when to ask a question. If you change your mind and wish to withdraw your question, please press 0 and 2. Participants are requested to use only handsets while asking a question. One moment please for the first question. The first question is from Salveen Richter at Goldman Sachs. Your line is open.
Hi. Thanks for taking my question. Could you maybe talk about, I guess, when you looked at, and this is a question for MorphoSys, but when you looked at partnerships, partners out there, the rationale behind choosing Incyte as your partner globally here. Secondly, for Incyte, Hervé, can you just speak to how this might affect just your commercial infrastructure, whether you need to add any salespeople, and how we should just think about the economics of the deal as it relates to the Incyte story going forward? Thank you.
Great. Thank you for your question. This is Jean-Paul Kress. I'll start with the MorphoSys perspective here. When we started to work on the partnership prospect, we leveraged the size of the asset to reach out to a broad scope of potential partners. It became pretty quickly apparent that Incyte was a great choice for several reasons, and we alluded to that in our introduction. One of the main reasons is the fit between the companies. I think this is very important. We had, of course, big pharmas interested, but we ended up with Incyte, because we have the same dedication to the asset and to the therapeutic area. For us, it's absolutely paramount that we ensure the right level of focus and dedication to the asset.
When you partner with a big pharma, and I've done that several times in my career, you have always a risk to be a bit diluted and deprioritized. We don't want that. We think the asset deserves ultimate focus, and we know that will happen without any doubt with Incyte. Beyond that, I think the other thing is that they have a very nice balance of commercial and development acumen, which we really value very much and very much looking forward to that. Salveen, do you want to add on?
Yes, Salveen. Good morning. First, it is clear that we will dedicate resources to this project, and we will make sure that it is very successful. I want to remind everybody that in the U.S., we have an established team that I think in this case could be very much used to maximize the potential of this product in the U.S., as we have been working now for 7 years in hematology, both in development, in medical affairs, and in commercial, with a lot of success that can be seen with Jakafi. In Europe, we have spent the last 4 years building a team covering commercially most of the European countries, and we have a development and medical affairs organization in Europe today in place that could be redirected from what they are doing currently to really help prepare for the launch of this product in Europe.
On both sides, I'm very confident it's a very good fit in terms of therapeutic area, in terms of customer base. We will have additional resources to add to what we have today, specifically in some areas of Europe, and we are totally ready to do that. The way it's going to impact us now, speaking of Incyte, the financial impact as your last question, we see this product contributing very well to grow the top line and bottom line into 2025 and beyond. That's obviously something very important to us. Obviously there is a shorter-term opportunity that could be coming from the current finding in relapsed refractory DLBCL. On both the sort of strategic fit and the financial aspect, I think it's a very good partnership.
As Jean-Paul said, I think there is, between the two companies, a state of mind, a way of thinking about how to be successful in this field that is very well-aligned. I'm very optimistic about the success of the partnership and the product. That is a very important product for DLBCL first and many other indications.
Thank you.
The next question is from Constantinos Tsepelakis, Deutsche Bank. Your line is open.
Thanks for taking my questions and congratulations to both MorphoSys and Incyte on today's news. My question is for the MorphoSys team. You've touched on it already, but could you provide some more detailed commentary on how competitive the process was for tafasitamab partnership, and how did you prioritize the following four considerations: financial terms, governance terms, potential partners' hemonc expertise, and potential partners' global presence? Thank you.
Thanks, Constantinos. Very happy to hear your voice here. Let me maybe start by the four points that you Well, the competitiveness. Yes, of course. We've been working on this process for the last several months. We've been told actually sometimes that we were a bit too slow. I have to say that since I started my tenure as CEO of MorphoSys September 1st, we've been full blast on that. I think delivering a partnership of this size, I think it's one of the largest partnership deal of the last couple of years. Very pleased with that, obviously, and the fact that we've ended up with this outcome. Very competitive partnership process. We worked with some advisors that helped us prioritize the contenders. We went through the whole scope of potential partners, including big pharmas, many big pharmas.
We didn't let anyone who could be interested or interesting out of the process. Incyte won the price. I think that's pretty well done, guys, because it was very competitive. On the terms, which obviously drove the decision, the financial terms obviously were very important. I think here we are achieving a set of accomplishments that we are very confident will allow us to continue to grow the value of the company. We can come back to that, but it's pretty self-explanatory. Also, in terms of the governance, I think we have a balanced set of governance decisions here. As a smaller company, we were very keen at retaining the strategic lead in the U.S., but we very much rely on our partnership with a more experienced company like Incyte. That's a balanced approach, but still we have a strong say.
The expertise was extremely important, together with the expertise, I would put the dedication and the focus because you can have a great expertise and be deprioritized because of other portfolio priorities in large pharma. That we had a couple of examples in our negotiation process that we did not want to go with a partner who would have an internal potential competition. There are several. The global aspect was important, I'd like to remind, like ourselves here, like Hervé did, that the U.S. is a top priority in this therapeutic area. Here we will have a double down approach, very strong complementary approach. Obviously, the value also comes from Europe, I'm very confident that Hervé and his team deliver there.
There is ex-U.S., ex-Europe, which is probably not as important, but we're not neglecting, and we'll make sure we address for the benefit of the patients out there. The U.S. is absolutely paramount, without any doubt.
Thank you very much, and congrats again.
Thanks, Constantinos.
The next question is from Mark Frank, Cowen and Company. Your line is open.
Yes. Thanks for taking my question, and congratulations to both companies on the deal today. Maybe for the Incyte team, MorphoSys has pursued a little bit different regulatory strategy or development strategy than some others in the DLBCL space in using a combination with lenalidomide and then also trying to replace rituximab in VR instead of just going on top. What made you comfortable that this is the right development program, rather than kind of pursuing what maybe Roche has done with Polivy or the bispecifics and CAR T cells have done in terms of going to the last line?
Mark, thanks for the question. I think, first, to step back, it's very important to realize that we believe, and frankly, with a lot of input from the scientific community around us, that inhibition of CD19 is one of the key mechanisms that will transform the treatment of B-cell malignancies. That's the first important frame to have in mind when we are thinking of what are the next steps. There is a number of settings, and the short term is in the relapse refractory setting, where the data that you have seen has been developed. It's very impressive data because the complete response rate is different from what you get from most products. It's somewhere similar to what you can get from technologies like CAR T. We think it is first in the relapse refractory setting, a product that will have a very strong competitive profile.
As you know, that setting is a very important segment of treatment of DLBCL. After that, the next step of trying to move it to the earlier line of treatment in combination with Rituxan or Rituxan combination regimen, is something that frankly, we will learn a lot from the ongoing phase I study that is now being run, and where the decision for the design of the first line study will be largely driven by what we will see as we go. In parallel, we have seen very interesting data combining this product with the PI3 kinase delta, and we think that it is another of the opportunities that could be expanding also the B-cell malignancy potential for the product. We are comfortable with the plan as it is.
We think there is a lot to learn with the new data that will be coming in the next few months. In fact, we think that we can transform, in some way, the treatment of many of B-cell malignancies. There is another layer of upside when we go to other types of indication. That, by itself, is justifying the agreement as you have seen it, and I think making the next few months of developing the potential for the product very exciting for both companies.
Maybe just to add on Hervé's comments here. The process for us was also a validation of our approach with the FDA. Many potential partners were actually impressed by the L-MIND-RE-MIND approach that we are using for the FDA, and obviously Incyte in the first row here. That was very important also for us.
All right. Thank you very much.
The next question is from Danielle Brill, Piper Sandler. Your line is now open.
Hi, good morning. Thanks for the questions. I guess, first for Incyte, curious how much overlap is there with the target physician base for your established commercial infrastructure? Do you have any plans to expand upon that? We've talked a lot about maximizing the full potential of tafa and moving up to earlier frontline development. Do you have any visibility on when those trials will be up and running, and who will be responsible for what in the areas that you're co-developing? Thanks.
Danielle, thanks for the question. On the overlap, in the U.S., it's very clear. In fact, we are already, as we speak, speaking to most of the physicians who are treating DLBCL through our existing hematology group. As you know, we have indications for our current product in myelofibrosis and PV, so that's covering a large part of the private market. Then we have an indication in the side of GvHD, which is sort of a side effect of a bone marrow transplant, which is also completely overlapping with the treatment of DLBCL. By the way, that's where also CAR T treatments are done. That's a very, very strong footprint overlapping very strongly. In Europe, we have a product that is used in the treatment of leukemia CML.
As you can see, it's also for most countries, completely overlapping with what we will be doing here in term of targets, with some exceptions, because as you know, by country, there are treatment patterns that are not always identical, but it's basically probably something like a 70%, 75% existing overlap. We will increase our footprint in Europe as we go through the next 10 months as the review process is ongoing, so that we will be fully ready by the time the product is approved in Europe.
Danielle, on the second part of your question on the clinical trials. We have a split of responsibilities through the agreement. The current trials, L-MIND, RE-MIND, B-MIND, First-MIND in first line, and COSMOS will continue to be led by MorphoSys. You know the strength of our developmental organization. That's not going to change. We'll continue to execute at the highest pace for that, and we agreed that the next extended indications beyond DLBCL, like follicular lymphoma, marginal zone lymphoma, and CLL, will be led by Incyte. We'll anyway work together on this set of studies because we have a joint approach and committees and governances. That's the structure in the deal.
Got it. Thanks very much.
Thank you.
The next question is from Evan Seigerman, Credit Suisse. Your line is now open.
Credit Suisse.
Hi there. Thank you for taking my questions. This is for Hervé and the Incyte team. What type of investment will be required for you to build out your commercial presence in Europe? As I know, in the past you've used partners to commercialize in Europe. Are there any synergies you'll be able to get from some of your portfolio products or investigational products if you eventually launch them in Europe?
Yeah, Evan, thanks for the question. Let me rephrase it a bit here, because there is the perception here that we don't have a strong European organization. I must say, and I understand why, it's based basically on the Jakafi partnership we did 10 years ago with Novartis. Since then, we have completely changed our approach to commercialization in Europe. We have acquired an organization four years ago. We have existing commercial products in Europe, commercialized by Incyte, and we have a footprint, as I just said, that is covering most of the hematology centers across Europe, with the exception of some countries on the Eastern Europe side, where we are working with distributors.
For what will be like 85% or 90% of the potential of this product in Europe, we have already an existing medical and commercial team in place that will be redirected now to support the launch activities for this product. At the same time, there will be an expansion of the headcount in Europe. It will be progressively done over the next year so that it will not be a sudden event in the short term. We think we have the existing capabilities to address the commercial challenge of launching this product in Europe in large part already, and we will increase to make sure that it's fully ready by the time the launches are happening in the different countries.
The next question is from Daniel Wendorff, Commerzbank. Your line is now open.
Thanks for taking my questions. Congratulations on the deal. Two for MorphoSys, if I may. When thinking of the milestone payments, can you potentially comment on how they are structured, roughly more geared towards regulatory or more geared towards sales milestones? What part of them are actually directed towards the first indication, R/R DLBCL? Second question would be, how should we think about the accounting treatment of the milestone payment? Thank you.
Yeah, Daniel, thanks very much for the question. Maybe first of all, would like to grab the chance to highlight that MorphoSys has the right to book the revenues in the U.S., because that has an important implication on the accounting treatment.
On your second question. Maybe coming first to the milestone payment. We have agreed to not disclose all the details here, but you can envisage that a program that is actually filed has certainly a very significant amount of regulatory milestone payments as well.
Yeah.
It's not necessarily the typical sales or bio dollar calculation. Please bear with us that we are not giving out and unable to give further details on how this takes place. Yeah. In terms of the accounting treatment, if you have the opportunity to book revenues, that requires then accounting-wise, a treatment where you have to split the upfront payment into a part that you can book as revenues directly under IFRS 15 in 2020, and there is a fraction that you can't book, but you have to apply IFRS 9. There are similar sort of regulations under U.S. GAAP, which leads to an accounting treatment where some of this upfront payment goes into the balance sheet as a financial liability. How that split will look like, we got to give some more guidance later towards end of Q1 latest when we give out guidance.
At this point in time, it's a bit too early to do this because the deal is so fresh. Of course, we'll keep you posted on how you have to think about the revenue projections for the company for 2020.
Okay. Thank you very much for now.
Thanks, Daniel.
The next question is from Alithia Young, Cantor Fitzgerald. Your line is open.
Hi, this is Li on for Alithia. Thanks for taking our question. Just one for Incyte. Should we expect further business development from here, or should we think that this will be the centerpiece for 2020? Just talk a little bit about how this deal might impact your BD priorities in 2020. Thanks.
Hi, it's Christiana Stamoulis. Regarding the BD activities following this deal, we still have over $1 billion cash on the balance sheet, our intention is to continue to assess external opportunities that could add to our internal portfolio. Obviously, this deal is very much in line with the objectives that we had for BD, with the objectives that we have as a company of diversification and continue to contribute to growth, especially in the midterm, and also leveraging our existing infrastructure in the U.S. and Europe. We'll continue to look for other potential assets that could add in a similar way to our strategic objectives as a company.
Thanks very much.
The next question is from Shanshan Xu , Berenberg. Your line is now open. Shanshan Shi from Berenberg, your line is now open. Maybe your line is on mute at the moment. We can't hear you.
Hi, can you hear me okay? Hello?
Yes.
Hello?
Hi, Shan shan.
Hey, I'm sorry. There's some technical problem here. Good morning. Congratulations on the deal. This is actually a question for Jean-Paul. I know Jakafi is a great commercial success in hematology, but do you consider Incyte's ex- US commercialization capability proven, given that Jakafi and Olumiant and ex- US commercialization was taken care of by both Novartis and Bayer? How do you factor that into your decision process?
Thanks, Shanshan. Look, for us, you cannot dissociate really Europe and U.S. I think they know how to do the job. They've proven in the U.S. A lot of their management has proven capabilities in Europe as well. Hervé made the point. I think it's about the dedication they are going to do to ramp up for the launch of the asset in Europe. They have some time because it's a year off vis-a-vis the U.S. I'm very confident they will do a great job there. I'm not worried. Remember, Europe is important, but it's not as important as the U.S. That's also to put in perspective. All in all, I think it's a very good proposal.
Thank you.
Thank you.
As a reminder, if you would like to ask a question, please press zero one on your telephone keypad. The next question is from Anita N in RBC Capital Markets. Your line is now open.
Good afternoon. Thank you for taking my question. I have a question for MorphoSys. I was wondering how this deal will impact combination therapies with MOR208, especially the potential combination with the asset from Vivoryon.
Hi, this is Jean-Paul. It doesn't change anything. We continue to evaluate the CD47-SIRPα inhibitor. That's what you're actually alluding to, and it's independent of the deal with Incyte here. It will not prevent us to evaluate other synergies and possibilities with tafasitamab as a cornerstone. There is no change of plans for the CD47-SIRPα inhibitor.
Okay, great. How would this influence splitting of revenues, in case of?
In that respect, the Vivorium compound and the option that we have remains with MorphoSys. It has no implications on this collaboration here, other than that we potentially could combine it with 208 and could run some clinical trial to the benefit of all parties. The revenues attributed out of the CD47-SIRPα compound remains with MorphoSys.
Okay, very clear. Thank you.
Thank you.
Thanks.
Please limit your questions per person for one. The next question is Jay Olson, Oppenheimer. Your line is now open.
Oh, hi. Congratulations on the deal, and thank you for taking the question. Could you please comment on the timeline for regulatory approval tafasitamab in key markets outside the U.S. and Europe? I think the press release specifically mentions Japan and China. Thank you.
Yeah. For Europe, you've seen the communication. We are actively working on the filing, and we'll sort out how we now finesse that with Incyte in the next couple of weeks and months after the HSR clearance. The goal is obviously to file by, as we said earlier, by mid this year. We can probably hope for a launch somewhere between early and mid 2021 in the first European countries. Ex-Europe, ex-U.S., we have to start to put our timelines together with Incyte, and we'll come back to you on that.
I mean, related to Japan, we have a development team in hematology in place today in Japan. That has been like three years of work. We will be starting the planning process because no study has been yet conducted in Japan with this product. As you know, there is a need to have some data in Japanese patients, and then we will obviously leverage the global program and see how it can apply to Japan. I would say there we are in a place where we, together, the two companies are starting, and will be starting the planning process in the next weeks following the closure of the deal.
Thank you.
The next question is from Marcus Wieprecht, MainFirst Bank. Your line is now open.
Yeah, hello. Congratulations from my side as well. One question, as it's limited on the impact on your U.S. infrastructure build-up. Has the co-commercialization deal any impact on your planned investments into the U.S. infrastructure, sales force, et cetera?
No, actually, we always plan to establish a fully fledged organization in the U.S., and by the way, we're complete. Right now, we have all our employees in Boston and already a full team of MSLs in [GamaLife] and are actually recruiting reps as we speak. We started post-ASH in November. No, that doesn't change because the approach is to double down and one plus one equals three. It's not to spare our capacity. That being said, obviously, we'll have to work on alignment and finessing the split of responsibilities and stuff like that, it doesn't change. I mean, we'll be fully fledged and staffed in the U.S. and that's the approach. In these kind of deals, here's what you do. You leverage each other expertise and contacts and outreach, you keep your full forces in place.
Okay, thank you.
Thank you.
Next question is from Gabriel from Mizuho Securities. Your line is now open.
Hi, this is Gabriel from Mizuho, and congratulations to both MorphoSys. Question is for Hervé, and I apologize if I missed this earlier, but has Incyte already done any pre-clinical work with, I think tafasitamab and parsaclisib? Does Incyte have right to develop tafasitamab in combination with other drugs in the pipeline?
Pre-clinical justification of tafa plus delta. The justification of tafa plus delta, frankly, is coming from the clinical data in a small study that was combining tafa with idelalisib. That had, I think it was 11 patients. In fact, nine of them responded of some very large proportion of the patient. I know it's small, it was certainly something that was exciting to see from the investigator side. What we plan to do is to confirm it with what we believe is probably a better PI3K delta. See if that effect can be replicated in a larger scale because it would really open a very interesting new possibility for both products. It's very typical in that case, is that in fact it would be helping both companies.
I think in general, there is a number of combination partners that we could go with. As the field is evolving, obviously we will be investigating all of these different possibilities to combine in B-cell malignancies because there are a number of mechanisms that are important. I want to repeat that we also believe that CD19 inhibition, we think will be one of the cornerstones of treatment of B-cell malignancies over time. This product specifically, compared to other CD19-targeted agent, I think has a lot of potential to become that cornerstone.
We have a follow-up question from Daniel Wendorff, Commerzbank. Your line is open.
Yeah. Thanks for taking my follow-up question. It's one for Incyte. I think you mentioned part of that in the last question, but my question actually would be, what attracted you most when looking at tafasitamab and being prepared to enter into this deal? Thank you.
I would say that, there are always all kind of dimensions you have to take into account. There's the financial dimension. What we said here is that we see it as a growth driver for revenue and bottom line in the years starting in 2025 to the 2030s. That's important for us in term of portfolio because it's sort of adding a growth driver and it's not overlapping in term of the patent situation and the exclusivity situation. That's certainly something that was sort of the target for us. The second piece is the clear synergy in term of the existing infrastructure. We spoke about it a lot this morning because I think it became a question or something.
There is a clear synergy in terms of infrastructure here, where we have an established hematology group in Europe and U.S. on the commercial side, the medical side, and the development side. When we were discussing together with MorphoSys on what would be the prospect and what we need to do for the next few years to maximize this product, what we found is that we were very aligned. The last part I would say is the spirit and the way sometimes company are wired can be sort of difficult to, or incompatible. What we found here is exactly the opposite, is that the history of MorphoSys, the dedication to discoveries, the ability to discover new antibodies over the past 15 years, is something that we admire very much.
I would say we have been a little bit in the same position on the small molecule side, where we have been one of the companies that was able to bring new products, new entities to market, doing the entire process. I think the mindset of the two companies, the flexibility, the ability to make decisions quickly, is something that will be very valuable in this partnership. There's a financial, there's a strategic, and then there is a feasibility overlap synergy. Then there is obviously the fact that we believe we can work together. I think it can become a very powerful partnership of two companies.
It's not a big pharma thing, but two companies with resources, with capabilities, with very good people to maximize the potential of this product in Europe and the U.S. for now, and the rest of the world as we go there as a step two.
Thank you very much.
We have no further questions coming through. I hand back to the speakers for some closing words.
Thank you everyone for your questions. We will now conclude the call. If any of you would like to follow up, both the MorphoSys and Incyte IR teams will be available for the remainder of the day. Please note that Incyte will present at the J.P. Morgan Healthcare Conference today at 8:30 A.M. PST. MorphoSys will present at J.P. Morgan on Wednesday, January 15th at 1:30 P.M. PST. Thank you for your participation on the call today, and goodbye.
Ladies and gentlemen, thank you for your attendance. This call has been concluded. You may disconnect.