All right. Welcome back to the 46th annual TD Cowen Healthcare Conference. I'm really happy to have the next session here with... I'm Marc Frahm from the biotech team here at TD Cowen, and we're really happy to have the next session, Incyte and Bill Meury, the CEO, to join. Maybe just to start off with, Bill, do you wanna just give a kinda high-level kinda status update of the company? What do you think the kinda key, you know, value creation events for investors will be over the next, you know, 12-24 months?
Yeah, sure. Thanks, Marc. I think about the business in 3 parts. Part 1 is we're focused on our core business ex-Jakafi, which in 2025 finished at about $1.2 billion. We estimate by the end of 2026 it could approach about $1.7 billion. We go out to 2030, we have a target for that business of $3 billion-$4 billion, which is to say that the core business ex-Jakafi has the potential to be as big as Jakafi is today by 2030. It replaces it. Key to that growth will be products like Opzelura, Niktimvo, Monjuvi, povorcitinib, and XR, namely. That's where the majority of our growth over the next 5 years will come from. Second, of course, is pipeline execution. We have 7 products that are in late stages of development.
That's where 80% of our R&D investment is, in those 7 products. On an unadjusted basis, we estimate peak sales for that group of 7 products could be roughly $10 billion unadjusted. Not all of them are gonna work. But I think the point in poor here is we have much more visibility into the growth profile of our pipeline at the end of 25, beginning of 26 than we did at the start of 2025. For example, we had no proof-of-concept data on INCB000928. We had no proof-of-concept data on G12D for pancreatic cancer or TGF-beta / PD-1 for colorectal cancer. We had no phase 3 data on povorcitinib. We had no frontline data in DLBCL with Monjuvi. We had no combination data of Niktimvo and Jakafi. We have all of that now.
We have more work to do in 2026, of course, and beyond, but I think the depth and maturity of our pipeline is stronger today than it was a year ago. Third is business development. You know, we'll use business development like any company to strengthen our core. We're not gonna use business development to fill a revenue gap, but rather to create long-duration revenue earnings and cash flow. Those are the three priorities of the company. We'll of course manage our cost base very carefully, both R&D and SG&A. In 2026, our SG&A is only gonna be up about 4% with G&A down 10. R&D, of course, is where we're leaning into to build a pathway to growth in that post-2030 period.
Okay. Great. Thanks for that overview. Maybe we'll start on the commercial side. The biggest longer duration asset for you guys right now in terms of sales is Opzelura. You know, your background's the commercial side. Now that you've been in the job for six months, you know, As you've kind of looked into that franchise and looking forward for it.
Yeah.
You know, what has Incyte gotten right about the commercial effort? What needs to be tweaked and is being tweaked now? I think we saw a little one piece of it with there's some pricing concessions this year.
Yeah.
What else beyond that?
Yeah, it's a good question. Fundamentally, that business is in a good position. What I mean by that is strong demand. 250,000 patients take Opzelura annually in the United States. Prescription volume is gonna be up 15%-20% year-over-year. There's 20,000 writers of Opzelura. You have exceptional formulary coverage. What you're gonna see in 2026 is we'll expand the size of the target audience, which means we'll expand our sales force to drive growth of Opzelura at some point in 2026. We'll call on more physicians. That's number one. Second, the NP/PA specialty in atopic dermatitis is very important. That segment, it accounts for roughly 40% of all prescriptions.
It'll be bigger than dermatology in AD probably this year. It's also the fastest-growing, so we'll relaunch or launch a new program to NPs and PAs, dedicated sales, dedicated MSLs, dedicated peer-to-peer program, dedicated materials. I think that focuses us on the first priority, which is continue to drive AD vitiligo use in the United States with Opzelura. All right? I think the other thing is the moderate AD indication in Europe is gonna be a real value driver. Just to sort of put it in perspective, first of all, in the moderate AD study, the drug had an EASI-50 rate of 70%, and there was itch relief in a large percentage of patients at 8 weeks. In fact, itch relief in some patients, about 10-15% of patients, was in 15 minutes.
It's a really, really good topical antibiotic, a topical anti-inflammatory. In Europe, we did $130 million with vitiligo. We didn't have the AD indication. AD is three to five times the vitiligo market. You could see revenue from Opzelura in Europe in AD approaching $200 million-$300 million over the next several years. The last point I'd make about Opzelura is we expect to have data on the use of Opzelura in HS at the end of 2026. An indication for HS for Opzelura could be as big as both AD or vitiligo is in the United States, which is $200 million-$300 million.
You know, one of the guidance pieces was on the quote, other oncology portfolio, which implied about 45% growth year-over-year in 2026 versus 2025. As we look at that kind of bucket of assets, what is there an asset in there that's like that's the one investors should pay attention to, that's the real growth asset that's gonna drive it over the longer term?
Yeah, it's a good question. I would focus on two, and that is, Monjuvi and Niktimvo. The majority of the growth in that business in 2026 and even in beyond is gonna come from Monjuvi and Niktimvo. As it relates to Monjuvi, we have a two indication drug today, CD19. We will release data in the second half of the year on our frontline DLBCL study. A modest share of the frontline DLBCL market, 'cause you do have Polivy out there and you have Epkinly. There'll be others. A modest share for Incyte, call it 10%, would double the annualized sales of Monjuvi today. Frontline DLBCL will be an important approval and new indication. Think community setting, think unfit patients, think a simple add-on to R-CHOP, and R-CHOP is still 50% of the frontline DLBCL market.
As it relates to Niktimvo, it's year 2, arguably the most important year in a launch. I'd say even more important than year 1. Off to a very, very good start. We have to continue to expand use, not just in 4th line, but in 3rd line. Over the longer term, demonstrating efficacy on top of Jakafi or a steroid will be important to the, you know, long-term peak sales potential of Niktimvo. When you think about that other oncology business, those are the 2 products that I'd focus on.
Okay. Just for that first-line DLBCL indication, is the marketing angle mostly gonna be kind of the ease of use and convenience for particularly in some of the settings like community? Is it a real efficacy differentiation versus some of the other agents beside R-CHOP that obviously you've beaten on top line basis?
Yeah. It's a good I think it's both. Here's what we know. We have a hazard ratio of 0.75. You'll see when we release the data of Monjuvi plus R-CHOP versus R-CHOP, what the PFS % look like and the delta versus R-CHOP. We'll also show activity in subgroups, ABC and GCB. I think there is a benefit risk proposition for Monjuvi in frontline DLBCL in the commuting setting for certain patients that as is compelling as the alternatives. All we need to do to move the needle here is, you know, collect sort of as a base case an incremental $200 million-$300 million in sales. It could be bigger. As you know, that frontline market is large. The unmet need there is cure, but only 40% of people are cured with current treatments.
I think when you see the data in the second half of 2026, you'll look and the totality of the evidence is fairly compelling. As you know, that landscape over the past couple years has really started to evolve. I think we're focused on where the drug will most likely be used. I think for a lot of people, it's gonna be a simple intensification strategy to, you know, Tafasitamab, lenalidomide on top of R-CHOP versus a replacement, which is what you use a T-cell engager, that benefit risk equation changes a bit.
XR should be launching later this year. I guess maybe you can walk through what the kind of value proposition is for that franchise versus, you know, traditional Jakafi, maybe from here to 2028, 2029 when the LOE happens. What's the value proposition to keep using it on the back end of the LOE?
Yeah, it's a good question. You have a more convenient form of the standard of care.
Yeah.
Just start with that, and I think that's clear. Once a day formulations, and providers know this, payers know, will usually deliver an adherence gain of 15% to 25%, right? There's the second sort of element of the proposition. Third, the price point is gonna be economical for providers, for patients, and ultimately for payers. Most important with this XR is, 1, generate demand, 2, will activate consumers. We have a database of Jakafi users that is sizable that we've built over the past decade plus. You have to get formulary coverage and secure enough formulary coverage that moving patients from IR to XR is frictionless. We will find a price point that makes sense for PBMs, payers, and one that makes sense for Incyte. This is a sprint.
There's two and a half years between now and when we lose exclusivity on Jakafi, and we're targeting a conversion rate in the range of about 15%-20%. I focus just below the midpoint and call it 20%. When generic forms of Jakafi are available, there is gonna be some headwinds on XR. At that point, Incyte is not chasing the XR number. XR is simply a bridge in the 2030 period. When you hit that period, we should be launching several products from the pipeline, which will shorten the duration of this trough and build essentially a glide path to growth. You know, certain formularies or certainly payers will keep XR in formulary. Others will want a discount, others will remove it from formulary.
I think all we need to do is get it to about 20%. It gives us the bridge that we need.
Okay. That's probably a good bridge now to talk about CALR and INCB000928 . Obviously we saw some data late in the year, presented at ASH. I guess, what are your, in your view, the questions that have clearly already been answered by INCB000928 , and what are the big remaining questions that you need to answer this year and beyond with that asset?
Yeah, I think the threshold questions in terms of INCB000928's utility in ET and MF have been answered. In ET, we have a complete hematological response of roughly, you know, just over 80%. Real-world, real-world evidence data with hydroxyurea, which is the standard of care, the CHR is like 25%-50%. Unlike hydroxyurea, which has 7 warnings and precautions, 40% of people have grade 3 AEs. The benefit risk profile INCB000928 is compelling. I think the availability of it, even in the second line, will reshape the use of hydroxyurea. Anyone that's not getting complete hematological response, who's in their 50s, gonna live with the disease for 30 years, is likely to get a targeted treatment. That's ET.
On the MF side, you know, the data from ASH, we have an SVR35 that's roughly 33%, TSS50 or 40%, anemia response in 50% of people in a second-line setting. VAF reductions will take more time in MF 'cause it's more complicated biology than ET. Right now, the focus is complete our interactions with the FDA. By the first quarter earnings call, I would expect we'll be able to provide clarity on the phase 3 program in ET second line. We've been having constructive interactions. The goals are still the same. Type 1, non-type 1. If it's not 1 dose, it's 2 doses, that's not an issue. Both clinical and molecular endpoints, we're still talking about the length of the study. Conventional is 52 weeks. That's most important.
We'll have that same conversation with the FDA on MF in the middle of the year. I would expect by the 3rd quarter call, which will be sometime in October, we'll provide more clarity on starting our second line study in MF. That is the regulatory milestones. In terms of frontline, which is very, very important, I do believe there's a feasible path to frontline in MF, whether it's frontline mono or frontline combo. We will share data in the second half of the year, towards the end of the year, INCB000928 in a frontline setting, both mono and combination, with the expectation that if those data stand up, we could be starting a frontline study sometime in early 2027.
Okay. I think before we get to that presentation at the end of the year, there's also planned a more Q2 midyear update on the second line patients.
Yes.
Maybe you wanna frame that, the size and scope of that presentation. I think, you know, you were able to get a few, Jakafi-ineligible people in...
Back into the ASH presentation. Are there more of those patients coming, which maybe gets a little bit of a flavor of what to expect at ASH?
Yeah. The data update for middle of the year INCB000928 second line, we had roughly 36 patients at the ASH at 24 weeks evaluable for efficacy. That number could be between 40 and 50. Let's call it 45 patients. In the ET, I believe there were about 30 patients that were evaluable for efficacy. That number is gonna be probably almost twice that. All right? I'm just talking about at week 24. As it relates to the frontline data, which was effectively a frontline-
Yeah
...population, JAK-naive, we're focused on the true frontline mono and combo study, and so you'll get a few more patients in that. What I would say about it is it's definitely a strong signal of efficacy. It, as you know, though, it's mathematically fragile. You know, one patient moves across the line, and you could move the SVR35, which was 57% in that population by, you know, 14 points. I think it was certainly encouraging, but the frontline data that we'll share will be the most important piece.
Okay. Maybe you started touching on the design question for ET, just dose, you know, to address all mutations. You know, how important is it to, maybe for convenience and ease of prescribing, have one dose, even if it means you're kind of overdosing some patients, versus, you know, really optimizing the dose for the right dose for the right patient?
It's a good question. I think that a one dose is always ideal. I think two doses is not an issue at all. If there was a, you know, the framework we've been working with, and all of this is subject to discussions with FDA, which are happening right now. If there's a starting dose and then an escalation dose, we'll have a sub-Q device on the market. I think that makes a great deal of sense for providers, and that is a framework that we're focused on.
Okay. Thinking back to going to frontline, when these trials started, there was this combo approach, particularly for the frontline, a concern that maybe the CALR antibody would take some time to really develop efficacy for patients, and you'd want the kind of rapid action of Jakafi. I mean, given the data we've seen and that there are some fairly rapid responses happening, you know, okay, what's the rationale for that combination still? Is it more like, "Look, this was just going and... But, so we'll see, but most likely it's the monotherapy"?
Listen, I think what you're describing is an induction and maintenance approach. In fact, if you ask most hematologists, put aside the regulatory environment and what you have to study, how they would use INCB000928, several have said to me, "I can envision a world or a future where I'm using Jakafi and INCB000928 together for induction and then maintaining patients with INCB000928," for obvious reasons. One, it's gonna provide spleen shrinkage, symptom relief and improvement in anemia, not just less anemia, which I do think is proof of mechanism. Then, of course, you have the disease-modifying benefits, which clearly are gonna take a little bit more time in MF.
Our view is, given the results we produced in a heavily treated population second line. I mean, I remind people that the average spleen volume size for people in that study was 2,350, all right, which is almost the same spleen volume as the COMFORT-I and COMFORT-II trials, and we had an SVR35 of about 25%. A small number of people. It seems to me that you're probably gonna get better results if you take a combination and move it into a pure frontline setting. All the options are on the table right now. When we get the results from our frontline studies, mono combo, in the second half of the year, we'll make a decision about exactly how to prosecute this.
Okay. maybe 'cause we're starting to get a little close on time. Just we'll turn to ET. we get a lot of questions about the IV formulation.
Yeah.
how acceptable that is there or how much it really relies on ultimately getting the sub-Q, the on body to work. Just what are your views? Is IV a viable formulation if that's ultimately what you need, or do you absolutely need the sub-Q?
In this population, I think a sub-Q is gonna be really important. Our aim is that within the first 6-12 months of the launch of INCB000928 for ET, we follow with a sub-Q device. I think the gold standard for a fast follow IV to sub-Q was Johnson & Johnson's Darzalex . I think we'll do the exact same thing here. There is the potential in ET to reach a several thousand patients. There are many patients out there that are not in the watch and wait bucket, that are not low risk, but are actually high risk, and they don't have complete hematological control.
A targeted treatment that's easy to take is gonna produce, for us, a meaningful revenue stream, and I believe the sub-Q will be available as we continue to move this program forward.
I think investors are used to, with subQ, you know, like, auto-injector pens and stuff.
This is a little bit different with the on body. You want to talk through kind of the format and what it, what that experience, what you expect it to be for patients if you?
Yeah, it's a disc, and it's a very elegant disc. The company is Enable, and it looks like Apple produced it. It's not a big, clunky device at all. We believe you affix it onto a part of your body, and we believe the infusion time is gonna be roughly 15 minutes, and you do it twice a month. Do it 15 minutes, take it off. Two weeks later, you do it again. If I was, like I mentioned, if I was 50 years old with ET and was gonna live with the disease for 30 years, rather than taking hydroxyurea, I'd rather take, you know, an infusion every two weeks, and I think that's the aim.
Maybe you started to touch on it a little bit of how the treatment paradigm may evolve in ET with this drug. Just what is that vision for what ET looks like on the back end of the second-line trial? You're reading out 'cause you have hydroxyurea, but also potentially in between you starting and finishing your, that trial, we'll also get bomedemstat data potentially for, from Merck. Just what does the ET paradigm look like in, you know, call it 2030 or something?
We have a targeted treatment that has high CHRs and fairly dramatic, deep, rapid VAF reductions. You'll get more data on VAF with our update in the middle of the year, and I think you'll find those data in ET, which is a pure setting. I think it's a crystal ball into how the drug works on mutant CALR. It gets more complicated, as we know, in MF. I don't see a reason or a version of the world where INCB000928 can't become standard of care relative to hydroxyurea or anything else that's out there for both hematological response and molecular response. I think the control rates with hydroxyurea are very, very low, not because it's not a good cytoreductive agent, but because people can't get to the therapeutic dose of 1,000 milligrams a day.
What, what's important to remember is that patients who have CALR and ET have very high platelet levels, like 1 million, versus, you know, 600,000 or 700,000 with other mutations. So INCB000928 in a CALR population is gonna be, I believe, differentiated rather, relative to other alternatives.
Okay. Is there a first-line opportunity in ET, and what does the drug profile need to look like to really support that?
I do believe there is a first-line opportunity. We're starting second line, and I say that because of the point that we just talked about, which is CALR patients have very high platelet levels. Dosing hydroxyurea high enough to control counts is more difficult, and in a first-line study, we may be able to show that in CALR, in CALR. That said, I think when a second-line study comes out with INCB000928. i think hematologists. Someone said to me the other day, "Hydroxyurea is what we have, and it's important, and it helps patients, but it's the equivalent of Tylenol for a fever." He went on to say that ET, while there's a large group of people that are in this watch-and-wait bucket or taking aspirin, there's many people that have gotten a partial response.
They have residual symptoms, residual thrombotic risk, residual transformation risk, and it's the equivalent of a ticking time bomb. I believe the second-line data will be enough. I think we're gonna still look at whether or not we could do a first-line study.
Okay. The other mutation that's quite important in these diseases is the actual JAK2 mutation, where you do have an inhibitor there. What does the bar for success look? Is there any look like for a mutant-selective JAK inhibitor? Is there any difference than how we thought about CALR, just based on the biology being a little different? Is it just, you know, the same kinda 30-ish% response rate?
I think the framework, if you have both clinical response, like you talked about, SVR35, TSS50, and then molecular response, I think the framework, Marc, is the exact same thing as we see for CALR with V617F. It's just that if you believe in INCB000928, V617F is 2x the size of INCB000928, given the mutation frequency.
Maybe you wanna explain how you have a couple different assets in the space, just how they fit or rights to a couple different assets in the space, how they fit together.
Sure. We actually have essentially 4 programs. We have a lead. We have an AC/ASD formulation of the lead to improve solubility, dissolution, and bioavailability. We have a backup V617F inhibitor internally, and then we have the option on Prelude. There's 4 horses in the race, and we're prepared to progress as many as we need to in order to solve what we think is not a PD problem but a PK problem. In other words, when you look at preclinical data with V617F, the very same models that predicted the utility INCB000928 in MF and ET also predict utility of V617F inhibitor in MF, PV, and ET .
I think we need to solve this PK problem, whether it's a Prelude compound, I'm really impressed with the work that they're doing, or whether it's one of our internal programs, we wanna get to the finish line sooner than later.
Maybe we are running out of time, maybe on povorcitinib, just say we get a lot of investor pushback of it's another JAK, like, aren't they just gonna lose out to other JAKs even if people wanna take the you know, that mechanism in some of these diseases you're developing. Just what are people missing about povorcitinib in your, in your view?
HS is the most challenging dermatological condition you can have. There is no FDA-approved oral treatment for mild, moderate to severe disease. If you look at the data, whether it's ours or even AbbVie's, I don't think it's... If I'm in a 1-of-2 situation in a market that does really well, that's excellent. It's a multi-cytokine inhibitor. Clearance rates, itch relief, flare control, draining tunnel clearance is as good with a JAK, povorcitinib, as it is with the biologics. It's oral, and the most important thing, it works faster. What is missing today in HS? There is nothing in the moderate to severe that's oral. You can use an antibiotic. Physician will tell you keep your skin clean, all right? Then you have to jump right to an IL-17.
I believe there's an opportunity for povorcitinib to be positioned in a pre-biologic setting, which would be a natural sequencing from antibiotics, whether they're oral or systemic, before you go to an IL-17. There's, of course, the post-biologic opportunity, which is rather than sequencing through IL-seventeens, you can move to a JAK inhibitor. Our data are very compelling. The most important thing for us right now is complete the NDA review with the FDA, assess the benefit risk, assuming that it works in both pre- and post-biologic, we have a broad label, and I think there's a lot of potential there.
Then maybe quickly on G12D, I obviously competitive space, you're towards the front of it. How do you, how do you win long term? Is it just about being first to market? Do you think INCB161734 is actually a differentiated G12D versus other G12D inhibitors?
Well, as you know, it's an on/off inhibitor, 80 times more selective for G12D, and we know that we can combine it with standard of care chemo. I think the most important thing for us to do right now with G12D is complete the phase 3, demonstrate a PFS of, call it, 9 months, hazard ratio of 0.7, and low grade 3 toxicity. If we're 1 of 2 in pancreatic cancer, I think we're gonna be just fine.
Okay. Unfortunately, that's all the time we have for today. We're already over a minute.