Incyte Corporation (INCY)
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2024 Wells Fargo Healthcare Conference

Sep 4, 2024

Derek Archila
Senior Biotech Analyst, Wells Fargo

All right, well, I think we'll get started with our afternoon session here at the Wells Fargo Healthcare Conference. My name is Derek Archi la. I'm one of the Senior Biotech Analysts here at Wells. Our next fireside discussion is with Incyte, and from the company, we have CEO Hervé Hoppenot, as well as the Head of R&D, Pablo Cagnoni. I tried.

Pablo Cagnoni
Head of R&D, Incyte

Cagnoni.

Hervé Hoppenot
CEO, Incyte

No, it was very good.

Derek Archila
Senior Biotech Analyst, Wells Fargo

Hervé, maybe to start, just kind of level set us in terms of, like, kind of state of the business, then we can kind of dig deep into some of these questions.

Hervé Hoppenot
CEO, Incyte

Okay. No, thank you for inviting us. So basically, when we look at today's Incyte, what you have is the commercial portfolio first, and both on Jakafi and Opzelura are doing very well, in fact, in multiple indications. So we can speak about the details, but that's one component. I mean, the growth of revenue continues to be very strong, and the fact that Opzelura is growing obviously faster than the rest of the portfolio is really important because over time, that's what we want to see happening. On the pipeline, obviously, you have different components. The first one is the IAI, dermatology, immunology pipeline, where some of the new Opzelura indication continue to be developed. And again, we can speak about that in HS, in prurigo nodularis.

We have povo, our selective JAK1, that is in three indication in pivotal studies and is also making a lot of progress. We can speak about, you know, when the data will be available, but we think it's a very important component. And then we have the acquisition of Escient, and now a new series of product in a fairly unique mechanism and very advanced science with X2 and X4. So that part is really developing. It's becoming a new part of Incyte. It's not just about cancer, hematology. Now, it's also about all of these other indications where we have very promising and interesting product. On the onco side, the way I think of it is basically in two different categories.

There is a current portfolio, which is the one that we know that has been in development for a while, where we got very good news over the past few weeks. One was the approval of AXA in GVHD, so FDA approval for axatilimab in chronic GVHD. We had positive data for Tafa in follicular lymphoma, phase III, and we have positive phase III studies with retifanlimab in squamous cell anal carcinoma. So all of that is going to contribute to revenue very soon. Twenty-five is going to start building from there. And obviously, we have the, you know, the franchise management with Jakafi, with BET, ALK2, and Axa, all of that making progress. And then there is what I, you know, think of as the new onco pipeline of Incyte, and there are five drugs that are being developed.

It's CDK2, it's V617F, it's CALR, it's KRAS 12 D, and TGF-β PD-1. So they are all totally unique profiles in phase I, so all of them are in the clinic. And frankly, I'm speaking to them because that's what's driving a lot of our resource allocation exercise that also took place over the past few months, where we see a lot of excitement. You will see at ESMO next week, in fact, some of the first data with the CDK2 in ovarian cancer and some other indication. And we have, obviously, a lot of optimism for the other five products there, for the other four products on top of CDK2. And that's what's leading to the other big event of the past few weeks, which is the resource allocation that took place.

The first part of the resource allocation for Incyte is obviously R&D and how much we are investing in our R&D, in our portfolio through our R&D. And what we did first is a reprioritization of the portfolio. So a number of projects were killed, in fact, technically, either because of data or because of competitive situation. So that was important. And then, obviously, we acquired Escient, so that was around $750 million investment to add this new mechanism to the portfolio. And we got a gift, which was the Tafa, second half of Tafa, that ended up being basically reintegrated fully to our portfolio. And at that point is when, because of this very promising pipeline, when we decided to do a share buyback through a Dutch auction, that, you know, was successful.

In fact, the fulfillment rate was 97%,

so it was relatively well-calibrated, and that was also executed over the past few weeks and is now behind us. So that was basically retiring 33 million shares from the share count. So that's sort of the exciting few months we had. I think there is a lot of positive coming out of this evolution of the pipeline, which has been something we have been obviously working on for a long time. And there is also a lot of positive on the commercial side with the growth that we are seeing from the current portfolio.

Derek Archila
Senior Biotech Analyst, Wells Fargo

Great. You've been busy.

Hervé Hoppenot
CEO, Incyte

It was a busy time and, very exciting. I must say, the level of internal-

Derek Archila
Senior Biotech Analyst, Wells Fargo

Yeah.

Hervé Hoppenot
CEO, Incyte

- excitement about what's going on is that, very high-

Derek Archila
Senior Biotech Analyst, Wells Fargo

Yeah.

Hervé Hoppenot
CEO, Incyte

In many ways. And part of it is the science and the fact that the pipeline is evolving in the right direction.

Derek Archila
Senior Biotech Analyst, Wells Fargo

Understood. I'd love to start the discussion around the upcoming data that you're going to present for your CDK2 at ESMO. Maybe you can just kind of tee that up, what we should be expecting in terms of patients. You know, ultimately, we hear about a lot of CDK2s that are out there. I guess, how do you think ultimately this data will either set yours apart or you know kind of support your development strategy with your CDK2 inhibitor?

Pablo Cagnoni
Head of R&D, Incyte

Certainly. So our CDK2 inhibitor, which we are predominantly developing in ovarian cancer, that's been an area of focus for us, and I'll talk about why in a minute. We think in ovarian cancer, we have the potential to be first. We know who our competitors are. There's two other programs that have been in the clinic for some time, one from Pfizer, one from Blueprint. They have presented small amounts of data in ovarian cancer with, you know, minimal modest single-agent activity. So we decided this was the right time to present the data, and I'll tell you a little bit more about that in a second, and at the same time, give you an idea of where we're going to go in terms of further development.

We think we have in our hands a developable drug, that the efficacy, the safety, in ovarian cancer warrant further development, and that's what we're going to talk about next week. It's a pretty substantial number of patients. We've been doing dose escalation. We've tested a range of doses. We tested a couple different schedules, and we're going to present data across that. We're obviously going to present the safety. We have seen, what we believe is a very manageable level of hematologic toxicity. You would expect Hemtox in the CDK2 inhibitor, we think is manageable. We have not seen ocular toxicity, which is something that, you know, we, we have been asked because one of our competitors have had a clinical hold based on that. We have not seen it. We've seen responses, and we're going to talk about that.

The presenter is going to be focused on ovarian cancer. We have a second tumor type we're going to talk about a little bit. We haven't disclosed what that is. It's not breast cancer, where we have seen efficacy as well. We've seen, obviously, as you would expect with CDK2 inhibitor, stable disease is an important component here. These medicines are not necessarily cytotoxic, but we have seen single-agent responses. So now the question is, what do we do next? And that's going to be part of the conversation next week. We think of ovarian cancer, and the competitive landscape there, obviously, nivolumab approved not too long ago, and now as part of AbbVie.

We believe based on data that we have internally, if we use CCNE1 overexpression, which is what we're going to use for eligibility for the studies, we need to define the overexpression cutoff with FDA, but we've been using an internal cutoff that which I think is very reasonable. I would say about half the patients that are CCNE1 positive, let's call them that, are folate receptor alpha negative. So the overlap there isn't 50/50, and we believe that about 40%-50% of patients with ovarian cancer are CCNE1 positive, so it's a sizable patient population. And the areas where we think this drug can be and should be developed are platinum-resistant later line. That's patients that currently, if they're not eligible for nivolumab, they're treated with chemotherapy.

It's a, you know, long list of different chemotherapy agents, none of which work very well. They have responses in the 10%-15% with PFSs in the four- to four-and-a-half-month range. So, you know, that's, that's one bucket. The second bucket, if we move to earlier lines, is after second line chemotherapy, platinum-sensitive patients, those patients get treated with chemotherapy, and then maintenance with bevacizumab. Some patients who get PARP inhibitors there. We are going to start a combination with Bev. We think that maintenance with Bev is another important bucket for us. Then the third one is, after first line chemotherapy, maintenance therapy. That's the biggest bucket, really, because those patients get very long durational therapy. Their PFS is very good, and we think that's another area.

And we think that there, because the toxicity that we've seen so far is manageable and there's no-- there doesn't seem to be any chronic lasting side effects, it's basically Hemtox. We think we can have an advantage even over emerging bispecifics in that, in that particular bucket of patients. So that's, that's what you're going to hear about next week. Yeah. Just to say one thing, because, you know, people... Sometimes the data cutoffs for this, data releases are confusing. There's an abstract that has a very early data cutoff. There will be a presentation at the meeting, a mini-oral presentation on Saturday, that has a different data cutoff later, and then the investor event that we're doing Saturday night has a later data cutoff. So that's the data you want to focus on. It's the most recent, most mature, most detailed, data disclosure.

That's the one people should focus on.

Derek Archila
Senior Biotech Analyst, Wells Fargo

Just how should we interpret the data? As, I mean, obviously good, which we know and I just want to mostly focus on, but in terms of, like, the activity that we'll see and just, can you maybe relay, like, how, you know, advanced are these patients that you're looking at in the trial?

Pablo Cagnoni
Head of R&D, Incyte

Yeah.

Derek Archila
Senior Biotech Analyst, Wells Fargo

Because, I mean, relative to what you're talking about as your development plans, you know, would we think that these are more advanced?

Pablo Cagnoni
Head of R&D, Incyte

Mm-hmm.

Derek Archila
Senior Biotech Analyst, Wells Fargo

or in the same ballpark in terms?

Pablo Cagnoni
Head of R&D, Incyte

No, these are very... Look, it was a, this was, is a phase I study.

Derek Archila
Senior Biotech Analyst, Wells Fargo

Yep.

Pablo Cagnoni
Head of R&D, Incyte

We expanded different dose cohorts to get more efficacy and to get better understanding of the safety at different dose levels and the pharmacology, but they're very heavily pre-treated patients. I mean, many, many patients have had two, three, four prior lines of therapy, and that's what you will see. Like with any medicine in cancer, as you move to pivotal trials, you refine the population, and you try to keep the population as homogeneous as possible, and that's what we will do. So the efficacy has to be taken in that context, which I think I'm glad you bring it up because I think it's important.

Derek Archila
Senior Biotech Analyst, Wells Fargo

Got it. Okay. I mean, anything else that, you know, you, you're going to focus on beyond just those two tumor types or any areas that you kind of highlight where you could potentially go beyond those, those two?

Pablo Cagnoni
Head of R&D, Incyte

The question that we are being asked is breast cancer, obviously.

Derek Archila
Senior Biotech Analyst, Wells Fargo

Yeah.

Pablo Cagnoni
Head of R&D, Incyte

You know, Pfizer has had a big push there. They have a big franchise with the CDK4/6 with palbociclib. We haven't given up on breast cancer. We've treated patients with breast cancer. We're not going to talk about them next week. I think we need a bit more time to make a decision, because I think the question there is the combination strategy.

Derek Archila
Senior Biotech Analyst, Wells Fargo

Okay.

Pablo Cagnoni
Head of R&D, Incyte

We don't have a CDK4/6 inhibitor. As you know, CDK2 is a mechanism of resistance to CDK4/6 inhibition. That's why this has been such a big area of focus for Pfizer. And it's a triple combination because you need to combine with hormonal therapy as well. It's a little bit more complex development plan, a little bit more competitive. We still have not made a decision, to be honest with you. We're not ruling it out, but the focus for now is to try to be first and move fast in ovarian cancer. We think it's a big opportunity. Ovarian cancer is the fifth largest cause of cancer death in this country. Mirvetuximab aside, there's been nothing happening in that space since bevacizumab, which was quite some time ago, and the options for patients with advanced disease are very limited.

We think we need to move quickly there and be as expansive as we can.

Derek Archila
Senior Biotech Analyst, Wells Fargo

Just last question on CDK2, but so if you were to pursue breast, would you do it alone, or would you look to partner, like, to get access to CDK4/6? Or, you know, how would that look? You know, just given that's a large, you know-

Pablo Cagnoni
Head of R&D, Incyte

Yeah, CDK4/6 inhibitors are commercially available.

Derek Archila
Senior Biotech Analyst, Wells Fargo

Yes.

Pablo Cagnoni
Head of R&D, Incyte

Obviously, there's three of them approved, and the other two companies, to our knowledge, don't have a CDK2 inhibitor.

Derek Archila
Senior Biotech Analyst, Wells Fargo

Yeah.

Pablo Cagnoni
Head of R&D, Incyte

Honestly, we could do a collaboration. If we're talking about true partnership to co-develop, we haven't done that, Derek.

Derek Archila
Senior Biotech Analyst, Wells Fargo

Yeah.

Pablo Cagnoni
Head of R&D, Incyte

You know, we have all the resources that we need to develop these medicines properly.

Derek Archila
Senior Biotech Analyst, Wells Fargo

Sure

Pablo Cagnoni
Head of R&D, Incyte

... and commercialize them, eventually. So it's not something we are contemplating right now.

Derek Archila
Senior Biotech Analyst, Wells Fargo

Okay, understood.

Pablo Cagnoni
Head of R&D, Incyte

A clinical collaboration, possible.

Derek Archila
Senior Biotech Analyst, Wells Fargo

Okay.

Pablo Cagnoni
Head of R&D, Incyte

But not a co-development.

Derek Archila
Senior Biotech Analyst, Wells Fargo

Got it. Yeah, that makes sense. Yeah, maybe shifting gears to myelofibrosis. Obviously, I want to tackle both the commercial and the pipeline, but maybe with the pipeline first. So, Hervé, you said, again, obviously, around, you know, CALR, BET, ALK. I mean, can you just walk us through, you know, how you see these contributing over the next, you know, five to eight years in terms of, you know, making up for the IP cliff with Jakafi? And I guess, how do all these puzzle pieces fit together?

Hervé Hoppenot
CEO, Incyte

I think first, I mean, the IP cliff for Jakafi, the way to address it is not just by working in myelofibrosis. I mean, so everything else, the entire portfolio is designed to be contributing revenue at the time when there will be no life cycle for some of the older brands. So we don't see it as like we, you know, one-to-one kind of replacement. That being said, we have leadership position in the field. You saw the work we did with Axa and GVHD.

Derek Archila
Senior Biotech Analyst, Wells Fargo

Mm-hmm.

Hervé Hoppenot
CEO, Incyte

There are three components to Jakafi: GVHD, PV-

Derek Archila
Senior Biotech Analyst, Wells Fargo

Yeah

Hervé Hoppenot
CEO, Incyte

... and the MF. For GVHD, Axa is now FDA approved. We know it has the potential in third line. If you base it on the performance of some other products that is approved, Rezurock is also approved in third line. It's around now $100 million a quarter, more or less, in that setting, and we are also developing it for first line. So we anticipate that by 2027, 2028, 2029, we will be more than replacing what is today's Jakafi in GVHD with the Axa. In PV and MF, as you know, in MF, we have a number of projects that are combining Jakafi. First, we have XR-

Derek Archila
Senior Biotech Analyst, Wells Fargo

Yeah

Hervé Hoppenot
CEO, Incyte

... so the once-a-day formulation, and then we have the combination with Jakafi. And there, I must say, we are still in the process of fully understanding the profile of ALK2.

Derek Archila
Senior Biotech Analyst, Wells Fargo

Yeah.

Hervé Hoppenot
CEO, Incyte

It's not yet fully solved. We are looking, we know we have an active drug with a BET inhibitor, and we are looking at what is the best setting for development together with the FDA, with all of the things that are happening around that. That's sort of what's happening. When you look at CALR and JAK2 V617F, it's a completely different game because now it's not just about trying to improve on the safety, like ALK2 or the efficacy of Jakafi, it's really changing the goal of treatment.

Derek Archila
Senior Biotech Analyst, Wells Fargo

Mm-hmm.

Hervé Hoppenot
CEO, Incyte

Both of them could have what we call a curative effect on some of these diseases, including PV with 617 F, including MF and ET with C ALR, and that could be... Each of them separately would be more than compensating for, you know, what Jakafi could be losing at the end of the decade. As I said, you know, when we look at the whole Incyte portfolio, so sort of MPN strategy is a big part of it.

Derek Archila
Senior Biotech Analyst, Wells Fargo

Mm-hmm.

Hervé Hoppenot
CEO, Incyte

So CALR, JAK2 V617F, but also you have to look at what the rest of the portfolio will be doing by that time, and that's where we feel fairly confident we are in very good shape.

Derek Archila
Senior Biotech Analyst, Wells Fargo

Got it. So maybe just, I want to dissect a couple of those. So with XR, you know, so Jakafi XR, you know, I think you're gonna give us an update at some point, you know, in terms of you know, I guess some of the data. I don't know if you generated the data, but I guess with the FDA and ultimately what you're gonna do to get that approved, I think that was coming maybe next year. So just clarify that. And then the other thing is, is that just gonna be pure switch strategy, and is that risky with payers today? I'm just kind of curious, like, you know, what kind of differentiation beyond the just extended release can you push to payers so that, again, it's not just like an old school spec pharma switch strategy?

Pablo Cagnoni
Head of R&D, Incyte

Okay, let me talk about first.

Derek Archila
Senior Biotech Analyst, Wells Fargo

Mm-hmm

Pablo Cagnoni
Head of R&D, Incyte

... and you probably want to talk about the switch strategy. So what we've said at the end of last year is that we first had to run a bioavailability study with new tablets. So we had to make new tablets for this based on the feedback we got with the FDA in 2022 , at the end of 2022 , beginning of 2023 . So that was done. We did a bioavailability study. That's done. Now, the next step is to do a true bioequivalence study. That will be run. The results will be available next year. We haven't given a more precise timeline, quite honestly, because, you know, these tablets, I have to put in stability, and we need to figure that part out, but that's all really a box-checking exercise mostly. There's a little bit of finesse here and there.

Once we have the data, we'll submit. We should have, if everything goes well, Jakafi XR should get approved no later than the first part of 2026. And that gives us two and a half or so years before the patent expiry. Got it.

Hervé Hoppenot
CEO, Incyte

So in terms of ambition for XR, you have the first level, which is once a day. It has a patent that goes to the 2030 s, and if we have a number of patients on the once a day, specifically new patients starting treatment, by the time the twice-a-day patent is expiring, you can imagine that the curve, the erosion curve-

Pablo Cagnoni
Head of R&D, Incyte

Mm-hmm.

Hervé Hoppenot
CEO, Incyte

-is slower, going down slower than it would without it. So by itself, it has value, limited value.

Pablo Cagnoni
Head of R&D, Incyte

Yeah.

Hervé Hoppenot
CEO, Incyte

It has some value, doing that. The second piece, which is way more interesting, is once a day, combined with once a day. And the question is, what kind of new product will be... Once a day product will be available for treatment of any of this disease by then? And obviously, you zoom on myelofibrosis, and you find that the BET inhibitor-

Pablo Cagnoni
Head of R&D, Incyte

Yeah.

Hervé Hoppenot
CEO, Incyte

Our BET or other BET are once a day, and obviously, the ALK2 is once a day.

Pablo Cagnoni
Head of R&D, Incyte

Mm-hmm.

Hervé Hoppenot
CEO, Incyte

There you have basically two ways to look at it. One is to do a fixed-dose combination, like a tablet that contains-

Pablo Cagnoni
Head of R&D, Incyte

Yeah

Hervé Hoppenot
CEO, Incyte

Both. That takes time, and it's feasible, and we will plan to do it. But even before you do that, you can do a co-packaging, you know, like Paxlovid, but yet same concept, where you basically have the two tablet in the same box, and then you have all the advantage of what the, you know, the fixed dose combination would do in terms of commercial impact. And so that's what that would be like the low tech, if you want, first.

Pablo Cagnoni
Head of R&D, Incyte

Yeah

Hervé Hoppenot
CEO, Incyte

... first approach that would be feasible by then, if we have the data that we hope for BET or for ALK2, where we would be able to do that, co- commercial- I mean, co-commercialization in the same container.

Pablo Cagnoni
Head of R&D, Incyte

Got it. Remember that the median duration of treatment to Jakafi MF is close to two years, and in PV is probably about 40 months. So patients that get started on once a day in 2027, 2028 are likely to stay-

Hervé Hoppenot
CEO, Incyte

Mm-hmm

Pablo Cagnoni
Head of R&D, Incyte

-on XR. Not all perhaps, but a significant number of them are likely to stay on XR after the patent cliff, and that could potentially, you know, smoothen the cliff.

Derek Archila
Senior Biotech Analyst, Wells Fargo

Got it, and then I wanna talk about CALR, 'cause I mean, that's something that-

Hervé Hoppenot
CEO, Incyte

Mm

Derek Archila
Senior Biotech Analyst, Wells Fargo

... you know, at least from our KOL checks, people are very excited about this mechanism. So maybe just, you know, talk about... I think we're supposed to get to maybe potentially early data next year, but you know, how, you know, important is this to your myelofibrosis franchise? And, obviously, you kind of talked a little bit about or alluded to maybe curative effects here, something like that. So that would be really interesting. Just highlight that a little bit more.

Pablo Cagnoni
Head of R&D, Incyte

Yeah, we think the mutant CALR antibody program is, first of all, I think as Hervé described, I think it's very exciting for patients. I mean, this is... If we are right with this hypothesis, you really are starting to talk about potentially a functional cure for patients with MF and ET in the case of a mutant CALR antibody. With V617F, you bring PV into the story as well. We have been in the clinic for about nine months now. The program is going well between patients with MF and with ET, and we will present data next year. We haven't said specifically the timing. That will depend on a few moving parts. You know, phase I studies, sometimes you can't predict the timelines quite very accurately.

And, you know, you expect to see over time, obviously, resolution of some manifestations of the disease, but the key endpoint that is a little bit different from mutant CALR and 617 F, that would be for Jakafi, is the reduction in the allele burden. It's really to try to see if over time, we can reduce the number of cells with a malignant clone, and then over time, the normal clone would out-compete the malignant clone. That would lead to a replacement of malignant hematopoiesis with normal hematopoiesis that would lead to what we believe one can define potentially as a functional cure. It's not a perfect analogy, but you know, one way to look at it is obviously Gleevec, you know, the BCR-ABL transcript that go down over time and over time, you know, obviously normal hematopoiesis corrects that.

It's a very different way to treat CML with Gleevec than it was to treat with hydroxyurea, which is you killed everything, and patients get a little bit better because you try to suppress hematopoiesis. So that's the story with the mutant CALR. So yeah, it's a key program for us. About 25% to 35% of patients are mutant CALR positive with ET and MF, so it's a big percentage of patients.

Derek Archila
Senior Biotech Analyst, Wells Fargo

Mm.

Pablo Cagnoni
Head of R&D, Incyte

If you bring six seventeen F into the story, basically, almost 100% of patients with MF, ET, PV are positive for one of those two-

Derek Archila
Senior Biotech Analyst, Wells Fargo

Mm-hmm.

Pablo Cagnoni
Head of R&D, Incyte

-mutant CALR or V617F mutation. So not only we think it's a different way to treat these diseases, it's important for patients, but we basically can transform the entire MPN space in a totally addressable population.

Derek Archila
Senior Biotech Analyst, Wells Fargo

Perfect. And then just on the commercial side of MF, so, you know, I guess Jakafi was, you know, last quarter or second quarter , this recent quarter, you saw some volume growth and continue to see volume growth like in the first half. So I guess, what's kind of driving that, given that there's incoming competition? You know, even we had surveys kind of suggesting that, you know, there might be more momelotinib use, but it doesn't seem like that's really coming to fruition. So like, I guess, what's driving the resilience? And also, is it just kind of category growth also, or is it more just you guys growing and the other ones, you know, growing a lot slower?

Hervé Hoppenot
CEO, Incyte

In MF specifically-

Derek Archila
Senior Biotech Analyst, Wells Fargo

MF, yeah.

Hervé Hoppenot
CEO, Incyte

I mean, if you look at the Jakafi growth today, I mean, it's driven by GVHD.

Derek Archila
Senior Biotech Analyst, Wells Fargo

Mm

Hervé Hoppenot
CEO, Incyte

-and PV, and PV is a key driver of the overall growth of the brand. In MF, we are very flat.

Derek Archila
Senior Biotech Analyst, Wells Fargo

Mm-hmm.

Hervé Hoppenot
CEO, Incyte

We can see it's like 1%, 2%. I mean, it's very small, low growth in volume and very low on price, in fact. I think what's driven is that Jakafi is the standard of care. The tolerability is way better than momelotinib.

Derek Archila
Senior Biotech Analyst, Wells Fargo

Mm-hmm.

Hervé Hoppenot
CEO, Incyte

And because, you know, when you look at the, you know, safety profile of both products, there are some important differences, and people are starting their treatment with Jakafi. And when Jakafi doesn't work anymore, which is most of the patient at some point-

Derek Archila
Senior Biotech Analyst, Wells Fargo

Mm-hmm.

Hervé Hoppenot
CEO, Incyte

You know, they will look at different alternatives. And what we find from market research is that momelotinib is used after Jakafi in most of the cases where it is. So it's sort of expanding the market. So I guess if you add the two of them, the overall market of MF is growing.

Derek Archila
Senior Biotech Analyst, Wells Fargo

Right.

Hervé Hoppenot
CEO, Incyte

-because momelotinib is doing very well. In fact, in some second line kind of setting, but it's not really changing the position in the first line of Jakafi as a standard of care.

Derek Archila
Senior Biotech Analyst, Wells Fargo

I mean, do you think in MF that just kind of flat to, you know, modestly up volume is sustainable for the next couple of years, or do you think you'll start to see-

Hervé Hoppenot
CEO, Incyte

For Jakafi?

Derek Archila
Senior Biotech Analyst, Wells Fargo

For Jakafi, yes.

Hervé Hoppenot
CEO, Incyte

I think, yeah, we see-

Derek Archila
Senior Biotech Analyst, Wells Fargo

Yeah.

Hervé Hoppenot
CEO, Incyte

We see that.

Derek Archila
Senior Biotech Analyst, Wells Fargo

No reason

Hervé Hoppenot
CEO, Incyte

... an existing book. As I said, the growth we are anticipating between today and 2030 or 2029-

Derek Archila
Senior Biotech Analyst, Wells Fargo

Yeah

Hervé Hoppenot
CEO, Incyte

is basically coming from GVHD.

Derek Archila
Senior Biotech Analyst, Wells Fargo

Right

Hervé Hoppenot
CEO, Incyte

-and P.

Derek Archila
Senior Biotech Analyst, Wells Fargo

Yeah. Just to understand the stability of MF, but you think it's gonna be pretty stable?

Hervé Hoppenot
CEO, Incyte

We anticipate it-

Derek Archila
Senior Biotech Analyst, Wells Fargo

Yeah

Hervé Hoppenot
CEO, Incyte

... to be very stable.

Derek Archila
Senior Biotech Analyst, Wells Fargo

Got it. Okay, then maybe just shifting gears to Opzelura. So obviously, a lot of excitement and obviously vitiligo and atopic derm and then, you know, some of the expansion opportunities. So, maybe just give us a sense of like, how that's growing right now in the on-label indications and, you know, what you think are the most interesting, you know, indication expansion opportunities for Opzelura.

Hervé Hoppenot
CEO, Incyte

So I will do. I mean, the two indication, AD and the vitiligo, are growing very well. In fact, they are growing at the same speed. So the ratios are not changing.

Derek Archila
Senior Biotech Analyst, Wells Fargo

Right

Hervé Hoppenot
CEO, Incyte

... very much. Maybe they are, but we don't see it. I mean, from all the data we have, it's still, it's still around the same. It's two completely different drivers. So it's interesting because it's-

Derek Archila
Senior Biotech Analyst, Wells Fargo

Mm

Hervé Hoppenot
CEO, Incyte

... two disease with two different pattern of growth. In atopic dermatitis, the profile of Jakafi is excellent in term of speed of action, in term of safety, obviously, as a topical, and the question is simplicity of prescription, because there are millions of patients who could benefit from Opzelura, who are not because it requires prioritization, and there are a number of hurdles that have been built and created to prevent this prescription to go through.

Derek Archila
Senior Biotech Analyst, Wells Fargo

Mm.

Hervé Hoppenot
CEO, Incyte

Which, by the way, it's sort of weird, because you can look at it as, you know, a product that is economically very valuable for the payer and for the insurer. But anyway, so we are working with the PBMs, and we are working with the insurance company to make that process easier. We have already some of our contracts, including the use in first line or the use with less steps required before you can go to Opzelura, and we have seen a positive impact on the volume and in fact, a relatively good impact on the simplicity for physicians. So that's the goal over the next five years, if you think of it long term, is make the prescription of Opzelura easy for the prescribers, because dermatologists don't want to spend their time on the phone-

Derek Archila
Senior Biotech Analyst, Wells Fargo

Yeah

Hervé Hoppenot
CEO, Incyte

Justifying their atopic dermatitis, eczema prescription. Now, they will do that for vitiligo. And in fact, in vitiligo, it's because of the competitive situation, the hurdles to prescribe Opzelura are different from what they are in atopic derm. What we have in vitiligo is a very good uptake of new prescriptions when you look at the data, and where we are still short of our ultimate ambition is on the number of refills. So the compliance of patients with twice a day treatment-

Derek Archila
Senior Biotech Analyst, Wells Fargo

Mm

Hervé Hoppenot
CEO, Incyte

... over a period of multiple months, because it takes months to see the effect of,

Derek Archila
Senior Biotech Analyst, Wells Fargo

Okay

Hervé Hoppenot
CEO, Incyte

... Opzelura in vitiligo. It takes minutes in eczema-

Derek Archila
Senior Biotech Analyst, Wells Fargo

Sure

Hervé Hoppenot
CEO, Incyte

... literally five minutes.

Derek Archila
Senior Biotech Analyst, Wells Fargo

Yeah.

Hervé Hoppenot
CEO, Incyte

So, so that's what we are working on. We see the growth continuing, but we also see that there is a lot of potential that we can, you know-

Derek Archila
Senior Biotech Analyst, Wells Fargo

Yeah

Hervé Hoppenot
CEO, Incyte

... improve on simplicity of access in atopic derm and refills and compliance in vitiligo.

Derek Archila
Senior Biotech Analyst, Wells Fargo

What do you think you need to do to address that? Is it more just kind of like patient education or-

Hervé Hoppenot
CEO, Incyte

Yeah, it's education.

Derek Archila
Senior Biotech Analyst, Wells Fargo

... physician education to do it?

Hervé Hoppenot
CEO, Incyte

Physicians need to speak to their patients.

Derek Archila
Senior Biotech Analyst, Wells Fargo

Mm-hmm

Hervé Hoppenot
CEO, Incyte

... more, and you know, you know it has to go quickly.

Derek Archila
Senior Biotech Analyst, Wells Fargo

Yeah.

Hervé Hoppenot
CEO, Incyte

So there is a time investment from dermatologists with their vitiligo patients to explain it will take three months before, or two months before you start seeing meaningful repigmentation, so that patients don't go through the first tube and then-

Derek Archila
Senior Biotech Analyst, Wells Fargo

Mm-hmm

Hervé Hoppenot
CEO, Incyte

... decide to give up because, you know, it doesn't, it doesn't work.

Derek Archila
Senior Biotech Analyst, Wells Fargo

Yeah.

Hervé Hoppenot
CEO, Incyte

Yes. So you-

Derek Archila
Senior Biotech Analyst, Wells Fargo

Uh,

Hervé Hoppenot
CEO, Incyte

... we know from the data.

Derek Archila
Senior Biotech Analyst, Wells Fargo

Yeah.

Hervé Hoppenot
CEO, Incyte

So there is still an education of the patient by the physician and obviously by every other channel that we know we can use to reach to patients.

Derek Archila
Senior Biotech Analyst, Wells Fargo

Where are you in terms of like... Because I think you initially had said you'd hope to see 10 tubes per year.

Hervé Hoppenot
CEO, Incyte

We are not there.

Derek Archila
Senior Biotech Analyst, Wells Fargo

Okay.

Hervé Hoppenot
CEO, Incyte

We are not there. We have room to grow, and that's something we are working on very actively.

Derek Archila
Senior Biotech Analyst, Wells Fargo

Got it.

Hervé Hoppenot
CEO, Incyte

I see it as a good news in some way. I see it as there is a lot of potential to do better.

Derek Archila
Senior Biotech Analyst, Wells Fargo

Mm-hmm.

Hervé Hoppenot
CEO, Incyte

And as we know, I mean, we are, you know, in our career, we all have worked on these issues with compliance and how patients will basically follow what was the, you know, the protocol in the clinical studies. And we know it's difficult, but we also-

Derek Archila
Senior Biotech Analyst, Wells Fargo

Yeah

Hervé Hoppenot
CEO, Incyte

... know there are tools that can make it happen, so.

Derek Archila
Senior Biotech Analyst, Wells Fargo

Got it. And then just in terms of those expansion opportunities, like which ones do you think, you know, are very attractive for Opzelura?

Pablo Cagnoni
Head of R&D, Incyte

We presented data early this year, and in patients with mild to moderate hidradenitis suppurativa, obviously HS is a very important indication for povorcitinib. It's been developed in pivotal trials for moderate to severe HS. That pivotal trial is gonna read out in the Q1 of 2025 , so that's a really important milestone for us, and first pivotal data on povo, which is a big part of the pipeline strategy. But based on the really, really impressive anti-inflammatory effect that Opzelura has, as I've described, it's very quick. Patients in AD feel better very, very rapidly. We decided to test it in mild to moderate HS. And that data, which we presented, clearly shows there's a benefit to the right topical agent in patients with early stages of HS.

The challenge is because patients with mild HS, particularly, don't have draining tunnels, that you can't quite use the same endpoints you use for approval, that we use for systemic therapy like povo, and in the same setting. So we are having conversations with FDA to try to define the endpoints in the right way, and they will make a final decision whether we run a pivotal trial, or it will simply be part of a publication strategy for HS. And the other one is, of course, prurigo nodularis. That's, you know, it's ongoing. Again, PN is an indication where rapid relief is critical. These patients have 20, 50, in some cases, 100 intensely pruritic nodules in the skin that just don't let them sleep, and scratching leads to scarring, and it's a really debilitating disease.

We believe that there's potential for a topic on inflammatory effect for patients with more limited disease. Again, the data we presented with povo PN shows very rapid improvement in itch, much faster than you see with Dupi if you put the data side by side. So we think povo has a lot of potential there, but once again, for earlier stage patients, potentially, Opzelura can have an impact.

Derek Archila
Senior Biotech Analyst, Wells Fargo

And so those would be more like kinda AD in terms of more instant-

Pablo Cagnoni
Head of R&D, Incyte

Yeah

Derek Archila
Senior Biotech Analyst, Wells Fargo

Itch relief versus the vitiligo, that's gonna take longer.

Pablo Cagnoni
Head of R&D, Incyte

Correct.

Derek Archila
Senior Biotech Analyst, Wells Fargo

So again, maybe the compliance or the adherence-

Pablo Cagnoni
Head of R&D, Incyte

Yeah

Derek Archila
Senior Biotech Analyst, Wells Fargo

and the number of tubes per year would be higher-

Pablo Cagnoni
Head of R&D, Incyte

Yeah

Derek Archila
Senior Biotech Analyst, Wells Fargo

You know, on the outset. Okay. Helpful. A couple of minutes left, so I wanna just hit two things. So, one, povorcitinib, also a very interesting asset, and you had some data in HS, and, you know, also could look like a pipeline or product. I guess, where do you kinda think that in terms of this, like, overall kinda peak sales, I guess?

Pablo Cagnoni
Head of R&D, Incyte

Mm.

Derek Archila
Senior Biotech Analyst, Wells Fargo

Like, you know, HS is a big market. Some of these other indications, again, a JAK with some JAK liability. So like, you know, I know a lot of the orals and I&I are trying to move away from those more, you know, kinda black box warnings-

Pablo Cagnoni
Head of R&D, Incyte

Mm-hmm

Derek Archila
Senior Biotech Analyst, Wells Fargo

- and liabilities, but I guess, where do you think that'll fit, particularly in some of the indications that you're pursuing with that asset?

Pablo Cagnoni
Head of R&D, Incyte

I'll let her comment on the big sales question. What I can tell you is povo is right now being developed in three pivotal indications, HS, PN, and vitiligo. The data will be HS early 2025, vitiligo and PN coming 2026, maybe 2027, depending on accrual. And also in the second half of next year, we'll have randomized phase II data in asthma and CSU. So five indications in the next couple of years. With povo, three pivotal, two randomized phase II data. So obviously, a lot of opportunities here and.

Hervé Hoppenot
CEO, Incyte

I think we can speak for the first indication in HS. I mean, you know, the range of forecast, depending on who you ask, you get the very big numbers. But we know, because we have been now one of the first companies developing a product for HS. We know it's very much underdiagnosed in the U.S. and even more outside of the U.S. We know there is a clear benefit from this treatment, and so we will have. With povo, we need to see the final phase III result before we can give some guidance or some number, absolute number. But what we see, that will be the first oral treatment with a biologic-like efficacy and a very good safety profile, and I think it will be one of the key player in the field of HS.

I mean, if you think of all of the different new drugs that will be available, it will certainly be one of the leaders.

Derek Archila
Senior Biotech Analyst, Wells Fargo

Got it. And then just quickly, last one. You know, mast cell diseases, you did the deal for Escient-

Pablo Cagnoni
Head of R&D, Incyte

Yeah

Derek Archila
Senior Biotech Analyst, Wells Fargo

... and, you know, in terms of the, the MRG, you know, mechanism, I guess you got a couple of readouts coming out next year for that asset.

Pablo Cagnoni
Head of R&D, Incyte

Yeah.

Derek Archila
Senior Biotech Analyst, Wells Fargo

What are kind of expectations for that mechanism? And-

Pablo Cagnoni
Head of R&D, Incyte

Yeah

Derek Archila
Senior Biotech Analyst, Wells Fargo

... I guess, particularly relative to, like, what we've seen maybe with some of the kits.

Pablo Cagnoni
Head of R&D, Incyte

Yeah. So, with the acquisition of Escient, we took in two programs, MRGPRX2, which is a mast cell-focused target, is expressed in mast cells, but not just mast cells, mast cells in connective tissue in the skin. We were very interested in the target, and we wanted to make sure we were first in class, and we are certainly in that spot right now. We have three readouts from MRGPRX2 next year, early next year. We have a study ongoing in chronic inducible urticaria, both cold induced and dermographism. We have a randomized double-blind study in chronic spontaneous urticaria, and a randomized double-blind study in atopic derm. And the second program, and I'll come back to your question about kit. The second program is an MRGPRX4 inhibitor.

X4 is a receptor that is affected by bile acids and bile salts. So we have a study ongoing in cholestatic pruritus, in patients with both primary biliary cirrhosis and primary sclerosing cholangitis. That study also will have data over the next year. So four readouts from the Escient acquisition. Look, when it comes to c-Kit inhibitors, there's no question that if you give a c-Kit antibody, that basically kills mast cells.

Derek Archila
Senior Biotech Analyst, Wells Fargo

Mm-hmm

Pablo Cagnoni
Head of R&D, Incyte

... you're gonna have a very strong efficacy in mast cell-driven diseases. The way we see it is, this is gonna be a balance between safety and efficacy. Patients with Chronic urticaria, chronic by definition, they need long-term therapy. They start with antihistamines. The dose of antihistamines is increased. About half the patients don't respond. Those patients need something else. The question is, what's gonna be the first line after antihistamines? When we saw the X2 safety data from the ongoing studies, it's an extraordinarily clean safety profile, which we think combined with good efficacy, will make for this the preferred agent after antihistamines. It's oral, well-tolerated, key for chronic therapy. Maybe the efficacy will be comparable to a kit antibody, we don't know. It's not certainly what we expect, but we think that the overall profile will be very important in patients with these diseases.

Derek Archila
Senior Biotech Analyst, Wells Fargo

Okay. All right, well, I think we'll leave it there.

Pablo Cagnoni
Head of R&D, Incyte

Great.

Derek Archila
Senior Biotech Analyst, Wells Fargo

Gentlemen, thank you so much.

Pablo Cagnoni
Head of R&D, Incyte

Thank you.

Hervé Hoppenot
CEO, Incyte

Thank you.

Derek Archila
Senior Biotech Analyst, Wells Fargo

Thank you.

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